Figures from the National Bureau of Statistics (NBS) on Friday showed the country's industrial output grew 12.3 percent in August from a year earlier, 1.5 percentage points up from July.  It was the fourth consecutive month of year-on-year growth acceleration. In the first eight months of this year, industrial output was up 8.1 percent year-on-year.

Fixed-asset investment in the first eight months rose 33 percent from a year earlier, 5.6 percentage points higher than that in the same period of last year. By sector, the investment growth rate was 60.4 percent, 27.0 percent and 37.3 percent respectively for the primary, secondary and the tertiary industry.

"Major data shows a clearer sign that the country's economy has began to recover. This will ensure the economic growth target of 8percent for the whole year," said Li Xiaochao, spokesman of the NBS, at a press conference.

Rising retail sales reflected acceleration in China's social consumption. Retail sales grew 15.4 percent in August to 1.01 trillion yuan (148.1 billion U.S. dollars) from a year earlier. The growth rate was 0.2 percentage point higher than July.

Zhang Liqun, a researcher with the Development Research Center of the State Council, told Xinhua: "Rising investment and consumption data indicated an increasing demand from the domestic market, which contributed to maintaining the rising momentum."

Premier Wen Jiabao said at 2009 Summer Davos in Dalian on Thursday that the unprecedented global financial crisis has taken a heavy toll on the Chinese economy. Yet, China has risen to challenges and dealt with the difficulties with full confidence.

In comparison with a rising domestic demand, weak demands from overseas markets still placed a big pressure on the country's foreign trade and the overall economy.

The imports and exports value of August was 191.7 billion U.S. dollars, a decrease of 20.6 percent compared with the same month last year, but a 2.3 percent increase from July, the General Administration of Customs said Friday. 

Even though the year on year comparison is improved, the actual trading value was down in August.  The reason that the year on year comparison got better is that the peak of last year's foreign trade was over, as China's total trade started to decline due to the international financial crisis.

Zhuang Jian, a senior economist with the Asian Development Bank, said the trade figures reflected that China's foreign trade is still weak amid a slowdown in international demand, but it had shown signs of recovery.

"As the country's economy is on a track of recovery boosted by stimulus measures, foreign trade is expected to improve gradually," said Zhuang.

To boost the economy in the face of difficulties and challenges, the Chinese government launched a basket of stimulus plan last September and reiterated its stance of maintaining the proactive fiscal policy and moderately loose monetary policy several times.

Under the moderately loose monetary policy, the country's banking sector extended significantly more loans this year to aid the economic growth, which has caused a lot of concern about China's future overcapacity and detrimental level of non-performing loans. 

The People's Bank of China said Friday China's new yuan-denominated lending in August rose to 410.4 billion yuan from July's 355.9 billion yuan. The August figure brought new yuan-denominated loans in the first eight months to 8.15 trillion yuan, 5.04 trillion yuan more than the same period last year.

As surging loans have sparked inflation worries, Li Xiaochao said the country did not face inflation currently, as both the major gauge of inflation and the major measurement of inflation in wholesale continued to drop in August compared with the same month last year.

China's consumer price index (CPI), dipped 1.2 percent in August from a year earlier; while the producer price index (PPI), fell 7.9 percent compared with the same month last year, according to the NBS.

Despite the achievements in economic growth, Li underscored the severe situation in the international markets, which still challenge the country's economy.

"With many uncertainties remaining in the prospects of the world economy, we still face tremendous pressure with the decline in external demand," Premier Wen said.