Macro Economy: Deflation pressure
(Chinanews.cn)
Updated: 2006-05-18 15:51 "As the consumer price index (CPI) in urban areas
will stay at a comparatively low level, deflationary trend still exists in China
in 2006." This is the overall assessment of the Chinese economy this year by
Tsinghua University's Center for China in the World Economy (CCWE) on May 13.
CCWE researcher Yuan Gangming indicated that judging by the situation in the
first quarter of this year, the Chinese economy was hot but did not go beyond
the limit.
According to statistics by China's central bank, the country used half of
this year's loan quotas in the first quarter. The overly rapid growth of loans
caused by the increase of fixed-asset investment has drawn China's attention.
Not long ago, the National Development and Reform Commission and the central
bank respectively published policies to adjust overheated industries and raised
lending rates, in an effort to jointly control package loans extended by local
governments.
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