China's government will be able to keep inflation in check, Premier Wen Jiabao said on Sunday, pledging to speed up efforts to rein in house price surges.

Steps taken in the past month, including outright price controls to curb speculation and monetary tightening, had started to produce results, he said.

Central bank the People's Bank of China raised interest rates on Saturday for a second time in just over two months as Beijing strengthened its battle against the stubbornly high inflation.

We have raised reserve requirement ratio for six consecutive times and increased interest rates twice to absorb excess liquidity in the market to keep it at a reasonable level to support economic development, Wen said in a state radio broadcast a day after the rate rise.

I believe we can keep prices at a reasonable level through our efforts. As a major leader of the government, I have the responsibility and I have the confidence, too, he said in remarks published on www.cnr.cn.

The central bank said on Friday it would deploy a range of measures to head off inflationary pressures and asset bubbles.

China intensified its property tightening measures in April and September in an attempt to brake soaring property prices.

Until now, the measures are not implemented well enough, and we will reinforce our efforts in two ways, Wen said.

The government plans to build 10 million units of affordable housing in 2011, up from this year's target of 5.8 million.

China will also increase efforts to curb speculation in the real estate market, mainly through monetary policies and stricter use of land, Wen said, without giving details.

Property transactions as well as land costs, a major contributor to high housing prices, have shown signs of a rebound in recent weeks, triggering concerns of more tightening.

Despite all the challenges, Wen said: I believe property prices will return to reasonable levels through our efforts. I have the confidence.

(Editing by Daniel Magnowski)

China Inflation