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Fitch said China's total credit, including informal lending among private entrepreneurs, may have risen to the equivalent of 198 percent of gross domestic product in 2012 from 125 percent in 2008. Forecasters who expected growth to accelerate might have been misled by inaccurate trade data due to companies falsely reporting higher exports as a way to evade capital controls and bring money into China, said Moody's Analytics economist Alaistair Chan. Despite the surge in lending, Monday's data showed a slowdown in investment growth that is driving the latest recovery. First-quarter growth in spending on factories, real estate and other fixed assets declined to 20.9 percent from the 21.1 percent rate for the first two months of the year. That shows the economy suffers from structural problems including excess production capacity in some industries that makes more investment unprofitable, said Yao. "Given all this credit injected into the system, the future should look better," said Yao. "Nevertheless, the level of efficiency in the economy has declined. The same amount of money will no longer produce the same amount of growth." In a positive sign, growth in retail sales edged up to 12.6 percent in March from 12.3 percent for the first two months of the year. Recent increases in required minimum wages and an improved housing market should help to boost household spending, said Moody's Analytics economist Fred Gibson in a report. Still, he cautioned, consumer confidence could be hurt if China's export weakness persists. Also Monday, the World Bank trimmed its growth forecast for China this year by 0.1 percentage point to a still-robust 8.3 percent. ___ National Bureau of Statistics (in Chinese):
http://www.stats.gov.cn/
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