The Consumer Price Index (CPI) is expected to rise by 4.6 percent this year and by around five percent in the first half of 2008, according to a forecast report by the Research Bureau of the People's Bank of China.

CPI growth will slow down next year unless food prices rise dramatically. Year-on-year CPI growth will be 6.3 percent in the third quarter of the year, 6.1 percent in the fourth quarter, 5.5 percent in the first quarter of 2008, and 4.5 percent in the second quarter, according to the report.

The report also forecasted gross domestic product to grow 11.6 percent this year and 10.8 percent in the first half of 2008.

The currency credit market will also continue to boom, the report said. However, rapid growth in the money supply is not a result of oversupply in basic currency, but of the robust loan demand and deposit money increases at domestic commercial banks.

According to the report, investment and consumption will go up 25-26 percent and roughly 12 percent respectively in 2007. Trade surplus will stand at US$250 billion this year, with growth in exports expected to fall while imports rise. The Producer Price Index is also expected to climb a little in the near future.