Inflation Concerns Mount In China After Earthquake; Action Could Break Economy

Inflation concerns continue to mount in China following the earthquake. While Sichuan province only accounts for 4% of China’s GDP, the area is the nation’s largest pig farming region and a significant producer of grains. In April, consumer prices in China rose 8.5% from a year earlier, well above the government’s target of 4.8%. To fight inflation, Chinese officials have tightened lending and raised bank reserve requirements four times so far this year. Further action could begin to hobble one of the world’s most important economies.

See Also: Chinese Quake Costs Businesses $9.5 Billion; Charitable Giving Down

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