China's second-quarter GDP growth exceeds expectations

Tammy Harvey
July 17, 2017

Chinese Premier Li Keqiang said last month that the country could reach this year's economic growth targets.

For the quarter, China's National Bureau of Statistics (NBS) said the economy grew by 1.7% in seasonally adjusted terms, in line with expectations but higher than the 1.3% increase reported in the March quarter.

"But worldwide instability and uncertainties are still relatively large, and the domestic long-term buildup of structural imbalances remains".

The data also showed China's service sector continued its expansion as Chinese economy reconfigured its base from previously strong manufacturing to services. It is unclear whether the new method has been used for Monday's second quarter GDP read.

The annual growth was forecast to slow to 6.8%.

Overall industrial production rose 7.6 percent in June from a year earlier, the government announced on Monday morning, an unexpectedly faster tempo than in May's 6.5 percent.

Over the half, China produced 419.75 million tonnes of crude steel, up 4.6% on the same period a year earlier.

China's growth domestic product (GDP) in the second-quarter rose 6.9 percent, well above Beijing's 6.5 percent target for the year. Industrial output, which rose 7.6% from the same period previous year, paced the GDP gains, while an 11% surge in retail sales underscored the strength of the domestic consumer economy.

Fitch Ratings on Friday maintained its A-plus rating for the country but said its growing debt could trigger "economic and financial shocks". The growth was forecast to stay at 6.5%.

China's economy expanded at a steady pace in the second quarter on domestic spending and exports despite measures taken to rein in financial risks. Trade data released earlier showed export growth accelerated in May and June.

The NBS also unveiled the growth of total investments in fixed assets during the first six months at 8.6 per cent compared to the same period of 2016, although it is 0.6 points lower than the first quarter of this year.

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