China may tighten money market to cool economy

BEIJING: China on Wednesday decided to shift its monetary policy from “prudent” to “tight” for next year to prevent overheating of its economy and vowed to take “forceful measures” to tame inflation, which has emerged as a headache for the government.

A key economic meeting for setting out priorities and targets for next year said China would control the volume and “granting pace” of loans to better regulate the domestic demand and balance international payments. Prudent monetary polices have been in place for a decade.

With prudent fiscal and tight monetary policies, China would take “two prevents” as it called, to prevent economic growth evolving from rapid to overheating and prevent price hike shifting from a structural one to evident inflation. President Hu Jintao addressed the three-day annual central economic work conference which concluded in Beijing on Wednesday.