The Chinese economy is growing faster than all expectations

Gladys Abbott
July 17, 2017

China posted better-than-expected growth of 6.9 percent in the second quarter, official data showed Monday, but authorities warned of lingering risks to the economy.

Output rose 6.9% in the three months ending in June compared with a year earlier, government data showed.

Industrial output, officially called industrial value added, is used to measure the activity of designated large enterprises with annual turnover of at least 20 million yuan.

Separate readings on industrial production, fixed asset investment and retail sales for June all came in ahead of forecasts. Therefore, the second-quarter upturn could be a boon for the country's leaders as they seek to contain a unsafe build-up in debt that has ballooned to 277 percent of gross domestic product (GDP).

But the latest data is well above Beijing's 6.5% growth target for 2017.

On a quarterly basis, China's growth improved to 1.7% in Q2 compared to a year ago.

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The result leaves China well placed to meet its 6.5% growth target for the year, though concerns remain over how sharply the economy will slow in the second half.

"The national economy performed within an appropriate range with more visible good momentum and achieved steady growth, rise in employment, stable prices, income growth and optimizing structures", said the NBS.

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

In 2016, China's GDP grew 6.7 percent, which is its worst performance in the past 26 years.

Gross Domestic Product (GDP) of the country grew by 1.7% in April-June on Q-o-Q basis, reported the National Bureau of Statistics on Monday. But growth is being pressured as Beijing tightens controls on bank lending to rein in a surge in debt levels.

Net exports' contribution to China's GDP growth in the first half of the year was 3.9 percent, a significant improvement from the same period last year, when net exports were a 10.4 percent drag on growth.

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