Chinese Premier Wen Jiabao said he was confident the government would bring inflation under control this year, in comments carried by state media Friday, even as consumer costs keep soaring.
"There is concern as to whether China can rein in inflation and sustain its rapid development. My answer is an emphatic 'yes'," Wen was quoted by the official Xinhua news agency as saying.
The comments were published as Wen began a three-country tour of Europe, landing in Budapest on Friday before visiting London and Berlin on a trip expected to focus on economic issues.
"The overall price level is within a controllable range and is expected to drop steadily. We are confident price rises will be firmly under control this year," Wen said, noting rapid price increases had affected many countries.
Beijing -- anxious about inflation's potential to trigger social unrest -- has been pulling on a variety of levers to rein in food and housing prices, such as restricting bank lending and repeatedly hiking interest rates.
Wen said the "host of targeted policies" introduced by the government "have worked" -- despite inflation hitting 5.5 percent in May, the highest level in nearly three years and well above the official annual target of four percent.
While the world's second-largest economy is showing signs of slowing, analysts expect authorities to hike rates for the fifth time since October in the coming weeks as Beijing battles to stem a flood of credit in the economy.
The government has been reluctant to aggressively raise rates for fear of triggering an explosion in bad debts following years of rampant bank lending.
China's top economic planner said this week that the inflation rate was likely to accelerate in June before easing in the second half of the year.
In the commentary, Wen said China's efforts to fight the global downturn -- a $586-billion spending spree -- was designed to "expand domestic demand and stimulate the real economy ... and make growth domestically driven".
"A notable result of our response to the crisis is that China has maintained steady and fast growth," Wen said, pointing to the blistering economic growth of the past three years. GDP grew 9.7 percent in the first quarter of 2011.
But there are fears the Asian powerhouse could be heading for a hard landing after recent data showed that manufacturing activity hit an 11-month low in June and year-on-year auto sales fell for two straight months in April and May.