19 Oct 2011

Slower growth in China

10:10 am on 19 October 2011

Economic activity in China has slowed due to government measures to control inflation curbed growth.

China's economy grew by 9.1% in the three months to September, compared with 9.5% in the previous period.

The People's Bank of China has increased interest rates five times in the past year and has also raised the reserve ratio requirement for banks regularly, thus reducing the amount of money they can lend.

A surge in property prices has been met by tightening credit markets.

Cornell University Professor Eswar Prasad says China is managing to cool the economy to keep prices in check, without upsetting its importance to the global economy.

Data released on Tuesday showed that factory output in China grew by 18% in September from a year earlier.

The European Union is the world's biggest purchaser of Chinese goods, with the market worth about $US380 billion in 2010.