The nation's consumer price index rose 4.4 percent year-on-year in October, well above the government's full-year target of three percent, with the prices of 18 types of vegetable rising by more than 60 percent.

"Inflationary pressures are growing," Deputy Governor Hu Xiaolian said in a statement published on the bank's website a day before a meeting on monetary policy.

Hu said the capital flows made managing liquidity more difficult because of "the policy of quantitative easing which leading developed nations are continuing to follow" -- a thinly veiled reference to the United States.

She warned that it would be difficult to meet China's lending target for the year, as demand for credit had been strong in recent months. After a record of 9.6 trillion yuan (1.4 trillion dollars) in new loans last year, Beijing set a target of 7.5 trillion yuan this year.

"The speed of Chinese economic growth continues, overseas trade and foreign capital have returned with growth and expectations of a renminbi revaluation continue to grow," she said.

To respond to the challenges presented by this situation, the People's Bank of China will manage liquidity and continue to regulate credit, she said.

On Friday, Beijing raised the amount of money that lenders must keep in reserve for the fifth time this year, from 17.5 percent to 18 percent.

The central bank hiked interest rates in October for the first time in nearly three years.

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