China’s economic growth moderated notably in the second quarter largely due to the high base of comparison, official data revealed on Thursday. Nonetheless, the pace of expansion remained strong underpinned by consumer spending.
Gross domestic product grew 7.9 percent year-on-year in the second quarter, the National Bureau of Statistics reported. Economists had forecast the annual growth to ease sharply to 8.1 percent from a record 18.3 percent.
In the first half of 2021, the economy expanded 12.7 percent from the same period last year. China aims to achieve above 6 percent economic growth this year.
On a quarterly basis, GDP was up 1.3 percent, faster than the 0.6 percent growth logged in the first quarter.
Activity in China remained strong in the second quarter, Julian Evans-Pritchard, an economist at Capital Economics, said. But with output already above its pre-virus trend, the economy is struggling to gain ground at its usual pace.
Headwinds to growth are likely to intensify during the second half of the year, the economist noted. The upshot is that the sequential growth is set to remain slow by historic standards over the next few quarters, with headline annual growth likely to end the year below 5 percent.
In June, industrial output growth slowed to 8.3 percent from 8.8 percent in May. Nonetheless, this was bigger than the economists’ forecast of 7.8 percent.
Retail sales expanded by a more-than-expected 12.1 percent year-on-year in June, following a 12.4 percent rise in May. Sales were forecast to grow 11 percent.
The surveyed jobless rate held steady at 5.0 percent in June.
In the first half of the year, fixed asset investment grew 12.6 percent from the same period last year. Economists had forecast investment to gain 12.1 percent.