Inflationary expectations are on the rise in China even though inflation itself remains mild, a senior government researcher said on Saturday.

How inflation unfolds will determine how quickly China shifts its monetary policy to neutral from its current stance of 'appropriately loose', Ma Xiaohe, deputy head of the National Development and Research Commission's macroeconomic institute, told a forum.

Consumer prices rose 2.4 percent in the year to March, within the government's year-average target of 3 percent, but Ma said rising prices of vegetables, edible oil and rice this month demanded attention.

Inflationary expectations are building or increasing now, he said.

Restating official policy, Ma said China needed to speed up its efforts to boost consumption so that it can contribute more than investment to driving growth.

(Reporting by Langi Chiang and Alan Wheatley; Editing by Ron Popeski)

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