China's economy sped up in spring

BEIJING - China's booming economy accelerated in the second quarter to its fastest growth rate since 1995, driven by surging exports and investment, according to data reported yesterday.

The government said it would take new steps to control the boom.

The figures put China on track for a fifth straight year of double-digit growth. If the pace continues for the rest of the year, China would replace slower-growing Germany as the world's third-largest economy.

The economy expanded 11.9 percent in the April-June quarter from the same period last year, even faster growth than the previous quarter's 11.1 percent, the National Bureau of Statistics reported.

"The key question is, how sustainable is all this? And the rhetoric in Beijing suggests the authorities think it is sustainable," Standard Chartered Bank economist Stephen Green said.

Inflation also rose, with consumer prices climbing 4.4 percent in June. The economy also felt pressure from a swollen trade surplus and high energy consumption, the National Statistics Bureau said.

"We will further enhance and improve macro control and put into practice various policies set by the central government," Li Xiaochao, a statistics bureau spokesman, said at a news conference.

The Chinese government will take steps to "change the pattern of economic growth and deepen reform," Li said. He gave no details of whether the government was planning a new interest-rate hike or other measures.

Communist leaders want fast growth to reduce poverty but are trying to cool some industries. They are worried that runaway investment could push up inflation or ignite a debt crisis if borrowers defaulted. China has raised interest rates four times since April 2006, and has imposed investment curbs on some industries.

The latest data prompted analysts to raise forecasts for full-year growth to as high as 11.5 percent from an earlier range of 9.5 percent to 10.5 percent.

The country's rise in consumer prices, lifted by a 7.6 percent jump in food costs, is well above the official target of 3 percent.