Inflation in China accelerated again to a near 11-year peak in October, prompting a visit by Premier Wen Jiabao to some of Beijing’s poor and a promise to stabilise prices.

Consumer price inflation, fuelled by soaring food costs, rose to 6.5 per cent last month, matching the level in August and rising from 6.2 per cent in September. The rise makes it all the more likely that the People’s Bank of China will soon raise interest rates for the sixth time this year.

Anxiety among Communist Party rulers that the rise in costs, particularly for goods, could undermine social stability, was reflected in the prime minister’s decision to go on a walkabout in the poorer alleys of central Beijing. He ducked into Number 22 Yu’er Alley, a courtyard of one-storey homes without indoor bathrooms, and shook hands with elderly Liu Xiuying. He told her: “Prices have been on the rise these days and I'm aware that even a one-yuan (6.5p) increase in prices will affect people's lives."

Food prices, which tend to be volatile, are not included in core inflation. However, economists have warned that the surge in prices for everything from pork to cooking oil could spill over into the broad economy.

Dong Tao, chief economist for Credit Suisse in Hong Kong, said: “When you see the costs at your dinner table going up forever, you will go to your boss and say, ‘Either you give me a salary increase or I will quit for another job'.”

The spike in inflation last month was overwhelmingly led by a rise in food prices, which were up 17.6 per cent from a year earlier with vegetables up 29.9 per cent and cooking oil soaring 34 per cent. Prices of non-food items saw a far more modest increase of just 1.1 per cent, the National Bureau of Statistics said.

With that relatively high rate of inflation set to persist in November, expectations are growing that the central bank will go ahead with at least one more 0.27 basis point interest rate rise before the end of the year to try to cool the economy.

The rise in food prices is a sensitive issue for the communist authorities because China’s poor majority spends up to a third of its income on food. Officials still remember the leap in inflation in the late 1980s that culminated in hundreds of thousands taking to streets to show their anger with the government and demonstrate their sympathy with student protesters in Tiananmen Square in 1989.

At the weekend, three people were killed and 31 injured in a stampede at a Carrefour superstore in southwestern China as shoppers scrambled for discounted cooking oil.

On Yu’er Alley today, residents said that they had been touched by the prime minister’s concern but more needed to be done. Mr Yi, a retired bank teller, said: “It’s very good that Premier Wen came here to show his support for us. But the question is whether local officials will really carry out his promise to control prices. Yesterday I didn’t want to pay 7 mao (4.5 pence) for onions but today all I could find was even more expensive at 8.5 mao (5.5 pence).”

Beijing froze prices of cooking oil and other basics in September and is pressing farmers to raise more pigs for a herd hit hard by blue ear disease. Price pressures are likely to ease when the new grain crop is harvested and more pigs come to market.

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