The central government has been advised by the National Bureau of Statistics against introducing further economic tightening measures despite unexpectedly rapid growth so far this year. Despite reporting higher-than-expected gross domestic product growth of 9.5 per cent in the first six months of the year, a government economist said the bureau was predicting that the economy would slow. The economist said nominal GDP growth, a figure not revealed to the public, was a more reliable indicator than the real-growth figure in the report, which the bureau adjusted for inflation and other factors. Nominal GDP growth had slowed markedly during the past few quarters, despite real GDP growth remaining relatively constant at close to 9.5 per cent. 'Other major indicators also suggest a slowdown or a likely soft landing of the economy in the second half,' the economist said. The bureau, which advises the government on policy issues as well as providing statistical services, said the economy was likely to move to a more sustainable level because of declining foreign direct investment (FDI) and slowdowns in the growth of domestic investment and exports during the second half of the year. FDI has declined on the mainland for the past 14 months, and was down 3.2 per cent year on year in the first half at US$28.6 billion. Exports rose by 32.7 per cent during the first half, a good deal lower than the 45 per cent growth registered for the whole of last year. However, the mainland registered a trade surplus of US$39.65 billion in the first half, larger than the surplus for all of last year. The combination of rising tension among trade partners, unlikely to be totally assuaged by last night's revaluation of the yuan, and continued dampening of property and fixed-asset investment could herald a slight fall in GDP growth. Mainland economists have long debated whether the economy is confronted by the risk of inflation or of deflation. However, more have been calling on the government recently to guard against deflation. They have also suggested that the government further shift the focus of its macroeconomic control policy from 'suppressing' overheating sectors to 'supporting' developing sectors. In late 2003, concerned about overheating in the steel, cement, aluminium and property sectors, the government introduced controls that included measures to limit the conversion of farmland for property development and tighter requirements on bank loans. Beijing said then that the controls were designed to be selective and two-pronged, with measures to suppress 'detrimental factors' in the economy while supporting the development of other sectors where bottlenecks existed.