China's Growth Moderates

A string of economic indicators suggests that China has tempered recent growth and inflation, an achievement that could make it more reluctant to appease demands from the Bush administration to let its currency rise soon.

The figures on softening domestic growth in China set the stage for continued tensions with the United States, which already said last week that it planned to impose quotas on imported Chinese trousers, underwear and cotton shirts. Already, Chinese officials have resisted calls from Washington to allow currency changes and have denounced preparations by the European Union to limit imports of Chinese clothing.

According to Chinese figures released this week, inflation has slowed significantly - with consumer prices just 1.8 percent higher in April than a year earlier. Inventories of unsold goods are rising at steel mills and other businesses, and imports of iron ore and many other raw materials have slipped. While exports remain extremely strong, domestic economic activity has moderated. Read more here.