It's not just rising petrol and housing prices that people are complaining about. The rising cost of daily items is also eating into wallets.

One in four urbanites think current goods and service prices in China are "rather high and unacceptable," according to a national survey conducted by the People's Bank of China.

The quarterly survey interviewed 20,000 households in 50 cities in May.

Economists believe curbing inflation should be one of the central government's priorities, together with checking investment sprees by local governments.

The average price of goods in May increased by 0.6 per cent on April, a rise of 1.5 per cent year-on-year.

Zha Ying, a 30-year-old housewife in the northern Beijing suburbs, is feeling the pinch.

"In addition to a rising petrol bill, I'm also quite sensitive to fruit prices," said Zha. Watermelons cost 3 yuan (37 US cents) per kilo where she lives, twice as expensive as last year.

The National Bureau of Statistics said average fruit prices edged up 4.7 per cent in May compared to April, a rise of 13.9 per cent year-on-year.

Although the government's consumer price index (CPI) grew by just 1.2 per cent and 1.4 per cent respectively in April and May, many believe the figures do not reflect reality.

"The low CPI doesn't give an accurate picture of people's expenditures," said Lin Yueqin, a researcher with the Chinese Academy of Social Sciences. "For example, soaring housing costs are not included in the index."

He warned that the cost of living is expected to continue its rise.

"Investment sprees by local governments may speed up resource consumption and cause further price hikes," he said.

Official statistics indicated that fixed-asset investment climbed 30.3 per cent year-on-year to 2.54 trillion yuan (US$317.5 billion) during the first five months of this year. Nearly 90 per cent of the investment was from local governments.

Lin suggested the central government pay "equal attention" to cooling down investment and consumer price hikes, because "the latter has more social implications."

This month taxi fares in Beijing rose from 1.6 yuan (20 US cents) to 2 yuan (25 US cents) per kilometre after the first 4 kilometres. Many residents have started to use public transport instead.

At Beijing Capital International Airport recently, a line of taxis waiting for customers was more than 5 kilometres long. To save on fuel costs which rose by about 10 per cent last month many taxis park outside department stores or office buildings instead of driving around looking for passengers when they are empty.

Source: China Daily