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Last Updated: Monday, 1 May 2006, 09:24 GMT 10:24 UK
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China has seen its official purchasing managers index rise to its highest level in 15 months, a testimony to the country's continuing economic strength.

The index increased to 58.1 in April from 55.3 a month earlier, hitting the highest level since January 2005.

The index is seen as a measure of the future growth of the economy.

Last week the Chinese central bank raised interest rates in an attempt to cool the booming economy.

The latest index figures reveal the strong position of the country's manufacturing industry, which is enjoying an export boom.

'Stable economy'

The purchasing managers index measures the future plans of Chinese businesses.

An index figure 50 is deemed a sign of expansion while a figure below is seen as a sign of contraction.

Last Thursday, he People's Bank of China unexpectedly increased its benchmark rates from 5.58% to 5.85%, which took the market by surprise.

The interest rate increase came after China's GDP accelerated to an annualised rate of 10.2% in the first quarter of 2006, compared to 9.9% in the previous quarter.

Zhou Xiachuan, the central bank's governor, said rates had been raised to counter the overheating economy which needed some "fine tuning."

"Overall, I believe that fiscal and monetary policy should be kept stable, but some fine-tuning is necessary" said government economist Zhang Liqun.

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