BEIJING - Amid pressure from soaring food prices, China's top economic planner predicted on Tuesday that the consumer price index (CPI), the main gauge of inflation, for the year, may exceed the 3 percent target set by the government in March.

"The CPI for the year may slightly exceed 3 percent. We're keeping a close watch on price fluctuations, particularly the food price," Zhang Ping, head of the National Development and Reform Commission (NDRC), said at a conference in Beijing.

He said the NDRC had previously estimated that the situation would not have been so grim in the fourth quarter, so the 3 percent target could be reached, but recent price hikes have made the commission adjust its prediction.

The devaluation of the United States dollar, the rising number of natural disasters in China, ample liquidity in markets and speculation all contributed to the recent price increases, he said.

Analysts have made further predictions. "Under the impact of the latest monetary policy of the US and Japan, China's CPI may reach 4 percent or even higher next year, especially in the first quarter of 2011," Zhu Baoliang, chief economist for the State Information Center, was quoted by the Xinhua News Agency as saying.

The increasing inflation pressure has made more people consider cutting their expenses.

A new survey conducted by the statistics bureau of Southwest China's Sichuan province shows that 51 percent of the 600 respondents said the increase in food prices exerts the heaviest pressure on their daily lives, and 20 percent of them have decided to tighten their purse strings.

"Even the price of battercake, which I have as breakfast every day, has gone up from 3.5 yuan (53 cents) to 4.5 yuan," said Cai Mao, 24, a resident in North China's Tianjin municipality.

Latest data released by the NDRC on Nov 2 showed that in October about 80 percent of the food products in 36 major cities across the country saw price increases over the previous month.

However, survey results show that 23.4 percent of people had not received a salary increase in the past five years, according to the All-China Federation of Trade Unions.

The Beijing Civil Affairs Bureau said on Sunday that if the price surge continues, the government will give special basic living allowances to low-income households.

The government of Northwest China's Shaanxi province on Oct 1 lifted the basic living allowance for low-income families to cope with the rising prices.

Similar practices have also been reported in Xiamen in Fujian province, Weifang in Shandong province and Hangzhou in Zhejiang province.

By Cheng Yingqi (China Daily)