The 2008 consumer inflation rate is likely to stand between six and seven percent, Xu Lianzhong, head of the National Development and Reform Commission's price office, wrote in an opinion piece in the China Securities Journal.

Overall, according to his estimate, consumer inflation for the full year would be slower than the 7.9 percent recorded in the first half, but well above the government's full-year target of 4.8 percent.

"The pressure of price increases will remain intense for the rest of the year," Xu said, adding policymakers will take measures to ensure inflation is "moderate" this year.

China's consumer price index, or CPI, softened to 7.1 percent in June, down from a near 12-year high of 8.7 percent in February. The government is scheduled to release July's CPI next week.

Xu suggested the government should rely more on fiscal policies, including tax cuts and increasing subsidies, rather than monetary policy to boost the supply of goods and services and ease inflation.

"A consistently tight monetary policy does not yield obvious effects in curbing inflation," Xu said.

China's economic growth slowed to 10.4 percent in the first half of 2008 from 11.9 percent for all of 2007. Beijing has hinted it will shift its policy focus towards encouraging growth while taming inflation.

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