The International Monetary Fund (IMF) that robust economic growth in the Asia-Pacific region may lead to overheating and rising inflationary pressures.

In a survey of the region, the IMF said in a report that countries need to adopt tighter fiscal policies and take measures to increase currency strength.

Asia's rapid growth is accompanied by the emergence of pockets of overheating across the region in both goods and assets prices, the IMF said.

In addition to higher policy rates, exchange rate flexibility is a key line of defense against overheating pressures.”

GDP growth in Asia-Pacific is expected to clock in at almost 7 percent for both 2011 and 2011, following a red-hot 8.3 percent gain last year, according to IMF projections.

Anoop Singh, head of the IMF’s Asia and Pacific department, said this solid economic growth will be driven by both exports and domestic demand. However, pockets of risk have become evident.

Singh also pointed to high rates of credit growth in the region as well as rapidly rising property prices in some regional markets.

Rising food and commodity prices also pose a threat to sustainable economic growth, he cautioned.

The regional inflation rate was estimated at 4.5 percent in February.

“Headline CPI inflation has accelerated since October 2010, and while this initially reflected higher commodity prices, pressures have now spilled over into core inflation and inflation expectations,” he said.

“While we expect inflation in many Asian economies to increase further in 2011 before decelerating modestly in 2012, inflation risks in Asia remain tilted on the upside.”

Singh said central banks in the region need to tighten macroeconomic policies.

The IMF report also praised the efforts of Japanese government officials to limit the economic impact of the deadly March 11 earthquake-tsunami and largely prevent spillover into neighboring countries. Although, given the magnitude of Japan’s catastrophe, IMF cautioned it is still too early to determine its long-term economic impact.

With respect to the region’s biggest and most important economy, China, the IMF said it is not necessarily at risk of overheating, despite the specter of higher food and housing prices.

IMF notes that the Chinese government has emphasized clamping down on inflation and has already boosted interest rates four times since last October. In addition, IMF thinks China will not allow its tightly-controlled yuan currency to appreciate too much.

Hong Kong, a key financial hub in the region, is at greatest risk of witnessing a real estate bubble (property prices have already surged 10 percent this year), IMF said, although the local government is taking measures to prevent such an escalation of prices by making more property available for construction and mortgage rates climb.

Over the long-term, the biggest challenge facing Asia-Pacific will be to achieve “balanced, sustainable, and more inclusive pattern of growth” and it warns that the “global imbalances that characterized the pre-crisis period remain unchanged.”