Wednesday, 15 August, 2018

China's GDP Report in Q2 Beats Forecast

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Sherri Watson | 18 July, 2017, 03:28

However, China's economy is not like other Western economies, and this prediction was emblematic of slowing growth that as recently as 2010 saw GDP growth at a rate of more than 10.5 percent.

Retail sales also impressed, lifting by 11% from a year earlier.

Onshore yuan rose for a sixth day on Monday after China's central bank raised the currency's daily reference rate amid a declining United States dollar and after the release of China's GDP data.

Export data last week showed steel products shipments fell last month, while aluminum sales overseas were steady. The two countries will also look to open China's market to US credit ratings firms and credit card payment services firms.

China's factory output grew 7.6% in June, the fastest in three months.

Trump has accused China of "dumping" steel into the US market and his Commerce Secretary, Wilbur Ross, has promised "bold action" that could come in "the context of national security".

On a quarterly basis, GDP added 1.7 percent from 1.3 percent in the first quarter matching estimates.

China's GDP Report in Q2 Beats Forecast

"If global demand for Chinese goods stays elevated, that will offset the curbs on growth that property and debt that the government has implemented", said Tao Wang, chief China economist at UBS.

Wu Yibing, joint head of China of Singapore investment firm Temasek Holdings, told Xinhua that his company wanted to increase investment in China's new economic sectors as Temasek was optimistic about China's ongoing economic transition.

The economy is likely to face further headwinds as consumption also comes under pressure from slowing income growth, said Fan Zhang, senior China economist at RHB Bank.

Property sales measured by floor area grew 16.1 percent in January-June from the same period a year earlier, up from 14.3 percent in the first five months of the year.

First, planned new investments have lost steam entering the year of 2017, suggesting that fiscal spending has been gradually fading. Studies over the years have found that China's national statisticians appear to overstate growth during periods of economic weakness and understate growth when the economy is booming.

The government is aiming for growth of around 6.5 percent in 2017, slightly lower than last year's actual 6.7 percent, which was the weakest pace in 26 years.