China's 2nd-quarter GDP growth steady at 6.9%

Jay Anderson
July 17, 2017

On a quarterly basis, the growth improved to 1.7% in the second quarter from 1.3% during the first quarter this year.

China eliminated around 120 million tonnes of low-end steel capacity in the first six months of this year.

Julian Evans-Pritchard, China economist at Capital Economics, said in a note: "The recent crackdown on financial risks has driven a slowdown in credit growth, which will weigh on the economy during the second half of this year".

The ChiNext, the start-up board at the Shenzhen Stock Exchange, was down nearly 5 percent on the day, but recovered somewhat as trade continued. Retail sales rose 11% year-on-year.

Communist leaders are eager to keep economic conditions steady as they head into a ruling party congress later this year at which President Xi Jinping is due to be named to a second five-year term as leader.

China's economy lost momentum in the second quarter, a survey shows, as Beijing's efforts to curb risky lending and investment took a toll on the Asian powerhouse.

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Strong retail sale and industrial production data supported offset of a slow start for Chinese stocks that may have been connected to the talks of stricter financial regulations.

The stronger growth also means officials will have more room to address the growing debt problem, as China continues to place controlling risk and deleveraging at the forefront of financial policy this year.

The service sector, already accounting for 54.1 per cent of the overall economy, expanded 7.7 percent year on year in the first half, outpacing a 3.5 percent increase in primary industries and 6.4 percent in secondary industries, according to NBS data.

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.

Trump has described the trade imbalances between the two countries as a "very, very big issue" that he would address. The trade surplus widened from $US40.8 billion in May to $US42.8 billion in June.

Other reports by BadHub

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