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China data shows cooling economy, as curbs take effect | China data shows cooling economy, as curbs take effect |
(about 2 hours later) | |
The latest economic data from China have backed up the view that the economy there is cooling. | The latest economic data from China have backed up the view that the economy there is cooling. |
New home prices in 52 out of 70 Chinese cities fell in December from the previous month, the National Bureau of Statistics said. | New home prices in 52 out of 70 Chinese cities fell in December from the previous month, the National Bureau of Statistics said. |
Foreign direct investment also fell for the second straight month in December. | Foreign direct investment also fell for the second straight month in December. |
Investment into China has surged in recent years with international investors looking to profit from China's booming economy. | Investment into China has surged in recent years with international investors looking to profit from China's booming economy. |
Losing steam | |
The National statistics bureau said home prices rose 1% in Beijing from a year earlier and 1.8% in Shanghai. Both figures are lower than readings for those cities in November. | The National statistics bureau said home prices rose 1% in Beijing from a year earlier and 1.8% in Shanghai. Both figures are lower than readings for those cities in November. |
Chinese property data does not give a national average, however Reuters news agency calculated that home prices rose by 1.4% in December, down from 2.2% in November. | Chinese property data does not give a national average, however Reuters news agency calculated that home prices rose by 1.4% in December, down from 2.2% in November. |
That would be the lowest reading in 2011. | That would be the lowest reading in 2011. |
Chinese authorities introduced a host of measures last year to try and prevent speculative bubbles in the property market. | Chinese authorities introduced a host of measures last year to try and prevent speculative bubbles in the property market. |
Curbs included bans on buying second homes in some cities and raising the minimum deposit as well as property taxes. | Curbs included bans on buying second homes in some cities and raising the minimum deposit as well as property taxes. |
"Our major progress is that speculative-based investment in the property market has been curbed," statistics bureau chief Ma Jiantang said at a news conference in Beijing according to reports. | "Our major progress is that speculative-based investment in the property market has been curbed," statistics bureau chief Ma Jiantang said at a news conference in Beijing according to reports. |
Overall, property investment increased 27.9% to 6.17tn yuan ($980bn; £640bn) in 2011, slowing from 33.2% growth in 2010, the statistics bureau said. | Overall, property investment increased 27.9% to 6.17tn yuan ($980bn; £640bn) in 2011, slowing from 33.2% growth in 2010, the statistics bureau said. |
Downside momentum | |
Some analysts have warned that the cooling property market is putting downward pressure on the overall economy. | Some analysts have warned that the cooling property market is putting downward pressure on the overall economy. |
"The property market correction is providing the greatest downside momentum," said Alistair Thornton from IHS Global Insight in Beijing in a note. | "The property market correction is providing the greatest downside momentum," said Alistair Thornton from IHS Global Insight in Beijing in a note. |
Foreign investment in China fell as the global downturn and financial volatility dampened investor appetite for spending. | |
Overseas investment dipped 12.7% to $12.24bn in December from a year earlier, the Ministry of commerce said. | |
It fell 9.8% in November, its first decline since 2009. | |
On 30 December the commerce ministry said the outlook for foreign investment this year was "not optimistic". |
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