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China Sees Business, Consumer Confidence Slide

Public confidence in China's economy is weakening as growth slows, and export orders and planned home purchases have fallen to the lowest in at least nine years.

BEIJING (AP) -- Public confidence in China's economy is weakening as growth slows, and export orders and planned home purchases have fallen to the lowest in at least nine years, according to a government survey released Tuesday.

The central bank's quarterly survey of businesspeople, bankers and members of the public also found 40 percent of people who responded expect China's inflation rate to rise despite a recent decline. The survey covered 5,000 businesspeople, 2,900 bank managers and 20,000 ordinary Chinese.

China's government is trying to tamp down inflation while moderating a slowdown that is expected to see the country's rapid economic growth fall as low as 9 percent this year from 11.9 percent last year.

That would be the fastest growth of any major economy at a time when the United States is struggling with a financial crisis and Europe and Japan are slowing. But Chinese leaders need to satisfy a population that has come to expect steadily rising living standards.

The survey's index for export orders fell to its lowest level since 2005, the central bank said, without giving detailed figures.

Only 24.5 percent of people surveyed thought their incomes would rise in the coming three months, the bank said. It said only 13.3 percent planned to buy a home over the same period, the lowest level since the survey began in 1999.

China's economic growth has slowed for four straight quarters, though the last quarter's expansion still was 10.1 percent.

Concern about the slowdown prompted the ruling Communist Party to issue an economic plan in July that switched the government from the single goal of crushing high inflation to the dual focus of ensuring fast, stable growth while controlling price rises.

The central bank cut interest rates on Sept. 15 for the first time in six years as credit-market turmoil dimmed the global economic outlook.