UPDATE 1-China targets '08 inflation below '07 level

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BEIJING, Dec 13 (Reuters) - China hopes to cap 2008 inflation below 2007 levels, although price rises next year will exceed this year's original target of 3 percent, a senior planning official said on Thursday.

Zhang Xiaoqiang, vice head of the National Development and Reform Commission, forecast that inflation would average about 4.7 percent this year.

Another NDRC official, Cao Changqing, said it would take a long period, even years, for China to tame consumer inflation, which hit an 11-year-high at 6.9 percent in November.

"We do wish the prices could stop rising, but because of both international and domestic factors, price rises will remain strong for a definite period," Cao, director of the planning agency's pricing department, said in a live Web cast on Thursday.

China's top leadership has said containing inflation is one of its major tasks in 2008 and that it will tighten monetary policy towards that end.

Cao said China's inflation was mainly driven by food prices, which contributed 4 percentage points of the 4.6 percent CPI growth in the first 11 months of this year.

It will take time for China to boost its supply of food to have a dampening effect on prices, and in the meantime demand would remain strong despite the higher costs, he said.

Cao said rising global commodity prices, underpinned by factors ranging from Australia's drought to the weakened dollar, were also causing trouble for China.

But Cao said Beijing would be able to keep inflation in check thanks to its own economy policies and good harvests.

China could also call on its massive stockpile of foreign exchange reserves, which stood at $1.455 trillion at the end of October, to shop around the world for more food, he said.

"For some commodities with insufficient domestic supply, like cooking oil, we can increase imports to meet market demand and ensure supply at home," said Cao. (Reporting by Eadie Chen and Zhou Xin; Editing by Simon Rabinovitch)