Annual growth in Chinese fixed-asset investment picked up to 25.5% in the first four months of the year, reinforcing expectations of further policy tightening to slow the world's fourth-largest economy.
The quickening in capital spending in urban areas, from 25.3% in the first quarter, was in line with economists' expectations and rounded out a strong batch of data for April that showed factories humming to churn out goods for both the domestic and overseas markets, funded by a gush of cheap money.
"The investment number is consistent with what we were expecting. In general, I would say that the economy is still running too fast," said Yiping Huang, chief Asia economist with Citigroup in Hong Kong.
Huang said the investment growth, along with figures that showed consumer prices up 3.0% from a year earlier and strong expansion of banks' loan books, underpinned his expectations of further tightening measures soon, but not necessarily imminently.
"We are expecting a rate hike in the coming months. We had a call of another rate hike maybe in May, but I would say that it could come in the next couple of weeks," he said.
Many analysts have been predicting that the central bank would raise interest rates again as early as this month, not only to rein in investment but to help keep the country's stock markets from spinning out of control -- a task some economists say is now just as urgent for monetary policy makers.
Faced with negative real interest rates on bank deposits, individuals have been flocking in droves to put their money into the red-hot A-share market, which has more than tripled in value since the start of last year.
The central bank has raised interest rates three times in just over a year and increased banks' reserve requirements seven times since last June to keep a gusher of cash from setting the economy off course.
Zhao Qingming, an analyst with China Construction Bank in Beijing, said that in addition to monetary measures, authorities could introduce more administrative and legal moves to control the pace of spending on everything from roads to shopping malls.
"The cheap supply of money, or the low interest rate, is just one underlying reason for the investment frenzy," Zhao said.
In the details, the figures released on Thursday by the National Bureau Statistics showed investment in the property and non-ferrous metals sectors -- both of which the government has said it hopes to keep in check -- growing an annual 27.4% and 47.2%, respectively.
Such specific signs of overheating are likely to invite measures by the National Development and Reform Commission, the economic planning agency, said Tim Condon, head of Asian research at ING in Singapore.
But overall, Condon did not think authorities would be alarmed by the latest batch of data, or the numbers on investment in particular. "Something between 20% and 30% is still in the comfort zone for the authorities. If it is above 30%, I think they will take this as a sign of
macro-wide overheating," he said. "I expect more interest rate rises, but not today or tomorrow. I've got the next one pencilled in for the third quarter."