The Paper Dragon has it under control.

...and yet, wage pressures subsist in light of price controls.

“China has made capping price rises the priority of macroeconomic regulation and introduced a host of targeted policies. These have worked,” Wen said in the commentary.

“We are confident price rises will be firmly under control this year,” Wen said.

He said the current situation follows increases in banks’ required reserve ratios and interest rates, which were hiked 12 times and four times, respectively, since 2010. He also cited reforms to the yuan’s exchange rate in June 2010, which have so far led to a 5.3% appreciation against the U.S. dollar.