China raises banks' reserve requirements

BEIJING - China raised banks reserve requirements for the third time in a month Friday, Act, the cool its economy as inflation 5% crowned exports gained sharply and the real estate market to pick up.

Data showed issued on Saturday morning in Beijing November consumer price index, rose by 5.1% a year earlier, a faster than expected acceleration from 4.4% profit in October. The highest inflation rate since mid-2008 increasingly the case for the Government on withdrawing to keep the easy credit policies that has followed since the financial crisis, as figures show strong growth in the economy dongle driver.

Access thousands of business sources on the free Web not available. More information

Exports and imports both monthly records in November, during the country's trade surplus grew $22.9 billion of October's $27.15 billion, constricted data showed Friday. Housing prices increased and the real estate boom recovered for the third straight month in November, having a minor correction earlier in this year despite a series of measures by Beijing in check.

"Very strong exports growth amid an already overheated domestic economy is not good news, as it the overheating pressures adds that even stricter measures to reduce the inflation will require the Government" Goldman Sachs economist Yu song in a statement said.

While decision to increase the amount of money reserve requirements by half a point of the Central Bank will reduce China's banks have to give, there is less impact on the economy as an increase in interest rates would have.

Could market fears that too much below will stall Beijing on growth facilitate - but maybe at the cost of raising ensure that authorities not doing enough. "Many market participants seem to think that the people's Bank of China is falling behind the curve", said Mark Williams of capital economics in London.

The more pickup in inflation still predominantly run in November by food prices which rose gain a year earlier by 10.1% in October to 11.7%. Beunruhigenden more analysts can pick up in nonfood inflation, the most important Chinese measure core inflationary pressures by 1.9% in November from 1.6% in October.

More stringent measures by Beijing hopes for a pick up in the global economy, reduced, as China is one of the few major economies that is growing rapidly. Click economic indicators such as the retail sales in the United States and consumer confidence have pointed out recently to a pick-up in activity and markets are larger growth prospects like Obama administration tax cutting deal more stimulus for the United States next year promises prices.

Last week, ratified the Communist Party of China's highest decision-making body, the transition to a tighter monetary policy, which describes it now officially as "prudent" rather than "moderately loose."

But so far authorities to combat inflation have moved carefully: by raising interest rates again in October, the people's Bank of China raised the reserve to on November 10 to November 19.

Even as Beijing signaled a shift in policy, arise signs, difficulties cannot restrict bank lending of the country. Growth in the wide m2 measure of money supply accelerated in November and made banks far more credits than expected.

All new loans for this year now stands at 7.44 trillion yuan ($1.12 trillion). Many analysts expect authorities, banks, which exceed the year loan objective of 7.5 trillion yuan.

China is becoming more of a boost from overseas demand than many had expected: the strong growth in exports, up 34.9% in November a year earlier, close to the top of October 22.9% increase, could be a positive sign for the global economy.

Royal Bank of Scotland Economist Ben Simpfendorfer, export promotion said a character is retailers in the United States and Europe aggressively stocked have stocks - for the holiday shopping season.

-Liu Li and rose Yu contributed to this article.

View the original article here