Prospects of further action to tighten the Chinese economy increased on Thursday as official figures showed growth surged to 11.9 per cent during the second quarter, while consumer inflation skirted a three-year high at 4.4 per cent last month.

The surprisingly strong rise in gross domestic product and the CPI, coming in spite of government tightening measures during the past year, prompted forecasts of another interest rate rise and the possible scrapping of a tax on bank deposit income.