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Last Updated: Monday, 4 February 2008, 11:00 GMT
World Bank sees a China slowdown
Street vendor, Beijing
Rising food prices are expected to drive Chinese inflation higher
The World Bank says China's economy will slow this year as the effects of a global slowdown take hold.

It is forecasting that the Chinese economy will expand 9.6%, down from the Bank's original forecast of 10.8% made last September.

The report also says inflation will continue to be a problem, with consumer prices rising 4.6%.

But the bad weather over the last few weeks is only expected to have a temporary impact according to the Bank.

Snow effect

Last year inflation rose to 6.5%, the highest level in 11 years.

Economist say that could head even higher in January and February because of food shortages caused by the worst snow in decades.

But the World Bank forecasts that inflation pressure will ease later in the year.

A moderate global slowdown this year would not hurt China much, according to the report.

It said the Chinese government could easily raise spending to compensate for falling demand overseas.

SEE ALSO
China's trade surplus jumps 48%
11 Jan 08 |  Business
China boom 'cushions world slump'
09 Jan 08 |  Business
China's economic muscle 'shrinks'
17 Dec 07 |  Business
Mighty China v humble China
13 Dec 07 |  Asia-Pacific
US and China clash on currencies
12 Dec 07 |  Business
US eyes 'balanced' China growth
06 Dec 07 |  Business

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