China moves to curb inflation
Friday, April 20, 2007 7:32 AM PDT
By Associated Press
Printable version
E-mail this articleBEIJING (AP) -- China's sizzling economy surged 11.1 percent in the first quarter, causing the country's Cabinet to declare Thursday it will take steps to keep the economy from overheating.
The pledge by the State Council came after the government announced that inflation rose to its highest level in more than two years.
Worries that Chinese authorities would raise interest rates to curb growth in Asia's second-biggest economy prompted regional stock markets to drop sharply. European markets also opened lower.
The consumer price index in March rose 3.3 percent, data showed, above the government's 3 percent target. And fixed-asset investment countrywide grew a robust 23.7 percent during March.
A statement posted on the council's Web site following a meeting chaired by Premier Wen Jiabao said the government will work to "reduce the country's large trade surplus, limit rapid growth in house prices and maintain basic price stability."
Asian markets fell ahead of the report's release in anticipation that the numbers would be stronger than expected and prompt Beijing to act to restrain growth in China, a major regional trading power.
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