A new report from the World Bank says Mongolia’s economy is “experiencing rapid growth.” According to the report, the country’s economy grew a whopping 17.3 percent in the second quarter of this year (compared to the same period last year). The growth was fueled in large part by the transportation and construction sectors, which grew at 39.9 percent and 38.4 percent, respectively. Retail and wholesale trade also showed impressive growth at 24.7 percent, as Mongolians are spending more as a result of higher incomes. And the mining and manufacturing sectors recorded respectable growth rates of 8.3 and 12.9 percent in the second quarter, respectively.

The report also says unemployment in Mongolia fell from 13 percent in December 2010 to 8.7 percent in June, which means Mongolia’s unemployment rate is now lower than in the United States.

But the report contains some bad news as well: Inflation is rising, up 11.4 percent in June (compared to the same month last year). Core inflation, which excludes volatile energy and food prices, rose even faster, by 13.7 percent. This inflation is being stoked by increased government spending, as well as increased spending by the private sector (both producers and consumers), as shown by a 106-percent increase in imports (relative to last year).