The Xinhua article did not discuss the implications of a tighter monetary policy for the value of the renminbi. But one reason China has kept its monetary policy loose for the last several years has been to issue more renminbi and buy United States dollars.

That currency market intervention has kept the renminbi weak and has made Chinese exports more competitive in foreign markets while making foreign goods more expensive in China. The United States, Europe and some developing countries have become increasingly concerned; they say the relative weakness of the renminbi has caused the transfer of jobs and economic growth to China. And the Obama administration in particular has been putting pressure on China to let the renminbi appreciate.

Tightening the money supply might mean China’s central bank would buy fewer dollars and might strengthen the renminbi against the dollar and other major currencies  the effect critics of China’s monetary policy have been seeking. But analysts do not expect the shift in policy to lead to significant currency appreciation.

The government reported that the consumer price index, an indicator of inflation, rose 4.4 percent in October from the same month in 2009. The increase was the largest in 25 months and higher than the rate policy makers in Beijing are comfortable with. The government wants the average throughout all of 2010 to be no higher than 3 percent; in May, the index nudged up to 3.1 percent over May 2009 and has been gradually rising since.