AFP: China’s gross domestic product (GDP) expanded 7.0 percent year-on-year in the second quarter, official data showed yesterday, beating expectations as months of central bank policy stimulus helped support the world’s second-largest economy.
The GDP figure announced by the National Bureau of Statistics (NBS) matched the 7.0 percent expansion in the first three months of this year and exceeded the median forecast of 6.9 percent in an AFP survey of 14 economists.
The figure was in line with the government’s official target for GDP growth this year of “about 7.0 percent”.
The better-than-predicted GDP result encouraged some economists to nudge their full-year forecasts higher.
China’s economy, a key driver of world growth, expanded 7.4 percent last year, slower than the 7.7 percent in 2013, and its weakest annual growth since 3.8 percent in 1990.
The slowdown has been a major factor in a global fall in commodity prices, and so far the economy has largely failed to pick up momentum this year.
“The domestic and external economic conditions are still complicated,” NBS spokesman Sheng Laiyun said. “The global economic recovery is slow and tortuous and the foundation for the stabilisation of China’s economy needs to be further consolidated.”
But in more bullish remarks he added that the figures showed growth had “stabilised” and was “ready to pick up”.
“It’s very likely economic growth in the second half will be better than the first half,” he added, citing positive factors including policy support and a recovery in the property market.
Chinese authorities are looking to diversify growth away from big-ticket projects -- that helped drive years of double-digit GDP expansion -- to consumer demand, which is seen as more sustainable. But too fast a deceleration in investment can be harmful to overall growth.
They have been taking more aggressive pre-emptive steps with the People’s Bank of China (PBoC), the central bank, cutting benchmark interest rates four times since November and reducing bank reserve requirements in a bid to boost lending.
Such measures can take time to affect growth.
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