Inflation ''could prove problematic for Chinese regulators''

Inflationary pressure on China could make things tough for regulators in the country when they set policies, according to one financial services provider.

Standard Life Investments notes that China will continue to boast a rapidly-growing economy, but that the composition of this is yet to be determined.

As a result, while opportunities will be created for investors, so will risks, with the firm warning that money supply and wage growth could push up exported inflation.

Should this occur, it could also cause issues when western economies are setting monetary policy, as well as those deciding the standards that govern people with finance jobs in Hong Kong and elsewhere in China.

Andrew Milligan, head of global strategy at the investment firm, said: "Chinese policy makers face growing tensions, for example between the demands of central and local government, between the relative importance of the manufacturing and service sectors, or between the desire for monetary control versus the pace of liberalisation in financial services."

According to Reuters, Josef Ackermann, chief executive of Deutsche Bank, recently said that in tackling the issue of high banker bonuses, Asian regulators have not gone further than the current G20 benchmark.