Note that as previously discussed, the rate hikes have, if anything, made it worse.

The slowdown comes from cutting back state lending and cutting back deficit spending.

And what usually happens is that governments press on with fiscal tightening, most often from automatic stabilizers triggered by the nominal growth, until they trigger a collapse and a hard landing.

But this time could be different…

China June Inflation at 3-Year High; Revives Rate Debate

July 9(Reuters) — China’s annual inflation accelerated to a three-year high in June, increasing the chances that the central bank will keep raising interest rates to tame price pressures that are spreading beyond food and energy.

Saturday’s data, which comes just three days after China raised interest rates for the third time this year, may prove to be the near-term peak for China’s inflation as global commodity prices cool, but most economists were still pencilling in one more rate increase this year.

The consumer price index for June rose 6.4 percent from a year earlier, slightly above economists’ forecasts for a 6.3 percent increase, with sharp rises recorded in food, consumer goods and property.