China's growth keeps momentum despite tightening

16:14, March 24, 2011      

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An index done by HSBC Holdings showed China's manufacturing activity is accelerating, powered by rising exports and consumption of an increasingly affluent domestic population.

The HSBC 's purchasing managers index for China may rise to 52.5 in March from 51.7 in February, according to The Bloomberg News report. This is the second time HSBC released advance data.

China's National Bureau of Statistics reported earlier that its producer price index jumped at the fastest pace in 29 months in February, and consumer price index hovered high at 4.9 percent, above the annual target of 4 percent set by Beijing.

Most analysts predict that Beijing might again raise interest rates in April, as inflationary pressure has kept building from higher global oil prices, rising rentals and food and labor costs.

The purchasing managers data "should reduce concerns about a sharp slowdown in growth," said Qu Hongbin, chief economist for China at HSBC, said in the statement. "Beijing's policy of tightening is working to contain inflationary pressures without choking off growth," Qu was quoted as saying by The Bloomberg News on Thursday.

The latest data showed renewed growth in export orders and slower increases in input and output prices, the report said.

Inflation should slow "meaningfully" by the middle of the year as Beijing continues to control urban property prices and rein in credit supply by commercial lenders, Qu said.

By People's Daily Online
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