FXstreet.com (Barcelona) - The Chinese government announced an urgent audit of all of the public debt held by local governments, according to China's National Audit Office. The move was prompted by increasing worries that the debt is out of control and could spark a financial meltdown.

The audit was orderd by the State Council, headed by Premier Li Keqiang, and made a top priority for the Audit Office, which will suspend other projects for the time being.

The world´s second biggest economy has been experiencing an alarming slowdown in growth in recent months. Chinese stocks slumped to the lowest level in three weeks following the announcement of the audit.