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China Calls for Measures to Prevent Economy from Overheating

The Chinese government has called for new measures to prevent the economy from overheating.

The official Xinhua news agency reports the State Council moved on Friday to tighten controls on fixed asset investments and money supply after concluding they increased excessively in the first quarter.

China's banks doled out $156 billion in new loans in the first quarter, more than half the target for all of 2006.

The Chinese economy is growing at a rapid pace, topping nine percent in the last two years. Leaders are concerned the pace could raise inflation rates or lead to investment in unnecessary projects.

The central bank said the growth of the broad money supply rose nearly 19 percent on a year-on-year basis to $3.9 trillion by the end of March.

Some information for this report was provided by AFP and AP.