China Economy Growth too “HOT” – China economy grew “hot” 10.3 percent last year. Inflation exceeded the government target of a full year. Phoenix Television , based in Hong Kong says it is on its website on Wednesday (01/19/2011).
Broadcasters It quoted unnamed sources as saying the central bank figures have been “leaked” the day before the government will release key economic data for December and for 2010.
Growth in gross domestic product compared with a revised 9.2 percent rise in 2009 which marked the fastest annual expansion since the beginning of the global financial crisis challenging Beijing to cool the economy.
Analysts have estimated that last year the world’s second-largest economy grew about 10 percent because it supported a strong demand for Chinese exports and massive investment in the property sector.
China’s consumer price index, the main measure of inflation, rose 3.3 percent from a year earlier for 12 months. This figure exceeded the full year target of three percent since Beijing’s soaring food costs, the report said. However, inflation in December slowed to 4.6 percent year on year (YoY) compared with 5.1 percent in November, which is the fastest pace in more than two years.
The producer price index, which measures the cost of goods at the factory gate, rose 5.9 percent over the year, as manufacturers passed on the spike in global commodity costs.
Beijing has tried to slow the economy and bring inflation under control amid fears that the soaring cost of food and household budgets straining property and threaten the trigger social unrest.
Analysts blamed the major stimulus measures the government for two years to combat the financial crisis to flood the market with liquidity, which in turn has led to rising housing prices and inflation.
The authorities have taken steps to turn off the faucet repetition which saw bank lending new loans almost doubled by 9.6 trillion yuan in 2009 because the banks heed call for the government to spur the economy amid declining.
The central bank on Friday ordered more banks to increase the amount of money they are retained as reserves, effectively put a cap on the loan, after raising interest rates for the second time since October.
Policy makers aim to cut new lending for 2011 by 10 percent from a year ago, state media reported Tuesday, after new loans in 2010 reached 7.95 trillion yuan, exceeding the official target of 7.5 trillion yuan.
Property prices remain high despite government measures such as raising the minimum down payment on property transactions for at least 30 percent is an effort to avoid a destructive price bubble. Other data will be released by the National Statistics Bureau on Thursday, including fixed asset investment, industrial production and retail sales.