The pace of Chinese capital spending slowed a touch in the first seven months of the year, but not by enough to dispel expectations of further policy tightening to cool the world's fastest-growing major economy.
Investment in urban areas in fixed assets such as flats and factories grew 26.6 percent between January and July, a bit below forecasts of a 27.0 percent rise and the first-half growth pace of 26.7 percent.
Coming a day after a similarly modest slowdown in factory output growth, the figures suggested to economists that there is no urgent need for the central bank to slam on the brakes. "Taken together with lower July industrial production, it supports the case that China is not overheating," said Ben Simpfendorfer, an economist with Royal Bank of Scotland in Hong Kong.
But investment was hardly weak. Capital spending in primary industries - sectors such as chemicals and smelting that are under government scrutiny because they pollute a lot and guzzle energy - jumped 46.2 percent in the first seven months. Investment growth in real estate accelerated, and the overall number of new investment projects picked up smartly.
"The central bank will definitely raise interest rates again before the end of the year, maybe next month," said Xue Hua, an analyst with China Merchants Securities in Shenzhen. "There's still an upside risk to investment, and the authorities will strengthen the implementation of administrative orders to curb loans to polluters," he said.
The Shanghai stock market, which rarely reacts much to economic data, was down 2.04 percent at midsession. It had already fallen 1.74 percent before the figures came out.