China is making efforts to keep prices of consumer goods and services basically stable, according to sources with the National Development and Reform Commission (NDRC).

The commission has decided that local governments should take measures to check any rapid rise in prices.

"If the year-on-year consumer price index (CPI) growth for an area hits four percent and lasts for three consecutive months, thelocal government should not raise any prices in the following three months, including parking tickets, water and so on," said anofficial with the NDRC.

The rule will also apply when the chain CPI growth over the previous month surpasses one percent, according to the official.

"Unhealthy factors are still bothering China's economy, including the pinched power supply and inadequate transportation,"said the official. "Price hikes of raw materials have started to show an effect on the prices of consumer goods."

Local governments must give priority to keeping the CPI stable,the official said.

Cao Yushu, NDRC's deputy secretary general, said at a forum last week that the agency will not raise electricity and gasoline prices if the country's CPI growth hits four percent.

China set the goal at the beginning of this year to keep CPI growth within four percent. The CPI in the first two months of 2005 rose 2.9 percent year-on-year.

NDRC also currently requires local governments to keep track ofprice fluctuations of important consumer goods, including grain, chemical fertilizer, oil products, coal, steel and commercial houses.

Source: Xinhua