China Tries to Turn Down the Heat

A move to widen the currency trading band and hike interest and reserve rates is designed to cool the raging economy

China's $2.6 trillion economy has been throwing off alarming heat flashes for months now. Ordinary Chinese have yanked some $9 billion in bank savings this year to join the merriment at the Shanghai Stock Exchange, where the composite index has shot up about 50% so far, following a 130% gain in 2006. The smaller Shenzhen bourse is up roughly 100%.

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