Economist predicts Q3 slowdown

Extremely high economic growth in the first five months of the year should slow down in coming months, the South China Morning Post reported. Inflationary pressures in the US and Japan will likely slow down the country's runaway economy, Morgan Stanley's chief Asia Pacific economist told the newspaper. But People's Bank of China Governor Zhou Xiaochuan told the Wall Street Journal the economy will expand at least 10% in the second quarter and throughout 2006. Despite measures to slow down growth, China's economy is steaming ahead, the newspaper said, with investments in factories and other fixed assets in the first five months of 2006 up 30.3% from a year before. Officials expect growth of 10.3% in the first half of the year and a more moderate 10% for all of 2006.