The price of new apartments rose in May in 67 out of

The price of new apartments rose in May in 67 out of 70 Chinese cities tracked in a monthly survey, the National Bureau of Statistics said Saturday, as the government battles to rein in inflation.

The cost of new builds climbed by more than 5.0 percent in 33 of the cities, compared to 37 to April, the figures showed.

Soaring property prices are a major concern for many Chinese, with apartments in the centre of large cities beyond the reach of most budgets.

The real estate sector is one of the pillars of the economy and land sales to developers are an important source of revenue for municipalities.

Beijing has called on cities to build more social housing but local governments fear a loss of income if they sell land at low prices.

In its struggle to dampen inflation, the Chinese central bank Tuesday said it would raise the reserve requirement for the sixth time this year, effectively limiting the amount of money banks can lend.

In May, even before the latest increase which takes effect on Monday, the volume of new loans had fallen sharply compared to April.

The consumer price index rose to 5.5 percent last month, its highest level since July 2008.

Further monetary tightening is expected in coming weeks as the authorities, anxious about inflation’s potential to spark social unrest, try to stem a flood of credit in the economy.

However, the Chinese are getting bargains in the US. America is for sale! Cheap! 🙁 The Chinese are buying up American assets!

Source – AFP