China’s GDP Grows 10.4 Percent in First Half, CPI Rises 7.9 Percent

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July 17 – China’s gross domestic product grew 10.4 percent to RMB13.06 trillion in the first half over the same period last year, the National Bureau of Statistics said on today.

According to the NBS, the primary sector generated RMB1.18 trillion, an increase of 3.5 percent; the secondary sector generated RMB6.74, up 11.3 percent; and the tertiary sector, RMB5.14 trillion, up 10.5 percent. The growth rates were 0.5 percentage points, 2.4 percentage points, and 1.6 percentage points, respectively, lower than the first half last year.
China’s GDP grew 11.4 in 2007. The high growth rate an soaring inflation is raising concerns over the economy becoming overheated.

China’s consumer price index also rose in the first half of the year, gaining 7.9 percent over the same period last year. The main gauge of inflation was broadly in line with most forecasts. China’s CPI rose 7.1 percent in June, 7.7 percent in May, 8.5 percent in April and a 12-year-high of 8.7 percent in February.

China’s consumer price index (CPI), the main gauge of inflation, rose 7.9 percent in the first half over the same period last year, 0.2 percentage points lower than the first five months, the National Bureau of Statistics said on Thursday.

The figure, compared with 7.1 percent in June, 7.7 percent in May, 8.5 percent in April and a 12-year-high of 8.7 percent in February, was broadly in line with most forecasts.

The prices rose by 7.6 percent in cities and 8.6 percent in rural areas. Grouped by commodity categories, prices for food rose 20.4 percent, contributing 6.64 percentage points to the overall CPI rise and prices for housing were up 6.9 percent, contributing 1.02 percentage points.
Prices for other categories of commodities rose or dropped slightly.

Inflation is expected to slow in the second half of 2008, but inflationary pressure from rising commodity prices and cost of oil may push the CPI up despite government controls.

Beijing has said it would continue its efforts to control inflation, and has shown no sign of loosening its stringent monetary policies despite pressure from the United States and the EU.