News Worms
News Worms

China growth steady despite crackdown on financial risks

China growth steady despite crackdown on financial risks

China's value-added industrial output, an important economic indicator, expanded by 6.9 percent from a year earlier in the first half, compared with the 6.8-percent increase for the first quarter, official data showed today.

Analysts had expected the world's second-largest economy to expand 6.8% in the April to June period.

Fixed asset investment gained 8.6 percent on year - unchanged from the previous month and beating forecasts for 8.5 percent.

The forecast of a gradual growth slowdown due to a weakening property sector, possible moderation of domestic demand as well as uncertainties over external demand remained valid, the report said.

The Chinese government previously stated that it is aiming for a minimum growth rate of 6.5% this year, a result that looks more than achievable given the strength seen in the first half of the year.

Retail sales rose 10.4% in the first half of the year, up 0.1 percentage points from the first quarter's rate.

Data released last Thursday showed China's exports rose a stronger-than-expected 11.3 per cent in June from a year earlier and imports rose by 17.2 per cent in the year to June.

"So I think the People's Bank of China just continues to be watchful". But some analysts expect increasingly stringent cooling measures will eventually drag on investment and dampen construction activity. In May, Moody's Investors Service downgraded China's credit rating for the first time in almost three decades, saying it believes the rapid build-up of debt is eroding the country's financial strength.

First, planned new investments have lost steam entering the year of 2017, suggesting that fiscal spending has been gradually fading.

The numbers come amid a trade dispute with the United States, which says China has flooded global markets with cheap aluminum and steel.

Despite growing concerns about China's financial risks, Premier Li Keqiang said last month that the country could reach this year's economic growth targets.


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