The nation's investment in fixed assets slowed in November, an early sign the government's latest round of macro controls are taking effect, according to analysts.

Fixed-assets investment in urban areas grew 26.8 percent year-on-year in the first 11 months, compared with a rise of 26.9 percent to October, the National Bureau of Statistics said on Friday. The statistics bureau didn't reveal figures for November.

"A slowdown of investment growth in November shows that the recent credit controls are starting to cool the economy," said Shen Minggao, an economist with Citigroup in Beijing.

Converting the year-to-date data to monthly figures shows that the growth of fixed-assets investment fell to 26.1 percent year-on-year in November from 30.7 percent in October, Shen said.

The government has taken measures to cool the economy in recent months amid increasing concern about overheating and rising consumer prices. The central government said it would rein in investment, which accounted for 42.5 percent of the country's gross domestic product in 2006.

The central bank has raised the interest rate five times and increased the reserve requirement ratio for local banks 10 times this year. Meanwhile, the central government has adopted strict administrative measures to curb loan growth and approvals for industrial land use, which analysts said was the biggest contributor to the investment slowdown.

"Lending in the property sector and for new investment projects accelerated sharply in November, confirming authorities' concern about a possible rebound of investment in the next few months," said Wang Tao, an economist with Bank of America in Beijing.

Investment by State-owned companies grew 16.3 percent in the first 11 months over a year earlier, while the growth was 16.6 percent to October, the statistics bureau said. But investment in real estate and new projects has accelerated in the past month.

"Whether these administrative measures will be strictly carried out early next year is still in question," said Wang. "Local government may encourage investment after its reshuffle in the first quarter next year."

Liu Mingkang, chairman of the China Banking Regulatory Commission, said this week that the banking regulator would watch for increased investment by local officials after the reshuffle.

"The central government may continue to use a batch of policies to cool the economy, such as further tightening of credit and money supply, and control of investment project approvals through land and environmental regulations," said Wang.

(China Daily December 15, 2007)