China's economic growth remains stable at 6.9% in the second quarter


While there is much debate around the accuracy of China's official economic data, last week the Chinese statistics bureau announced it has revised the way it calculates the country's GDP. Factory output and retail sales clocked 7.6 and 11 per cent growth respectively.

Despite China's better than expected GDP results, analysts expect the country's economy to slow down later in the year saying that the effect of the recent stimulus procedures will start to fade away as Beijing looks for a solution to ease a red-hot housing market and tries to control leverage.

But a sharp slowdown in the second half is unlikely as policymakers prepare for an important Communist Party congress later this year that will likely cement Xi's place as the most powerful leader in a generation.

"China's strong first half to the year won't last", Capital Economics China economist Julian Evans-Pritchard said in a note.

That was the same as during the first quarter of 2017 but slightly better than the 6.8% pace which economists had been anticipating.

A consolidation of power could give Xi more clout to push through what analysts say are long overdue but painful reforms such as restructuring massive state firm debt.

While fixed asset investment saw strong growth year-on-year of 8.6%, it was 0.6% lower from Q1.

Economists polled by Reuters expect the economy grew 1.7% between April and June-an annualised rate of 6.8%.

China's imports rose 14.5 percent in the second quarter from the same period a year ago, as prices soared for iron ore and other raw materials essential to Chinese manufacturing.

Chinese exports will remain the backbone of growth in the world's second largest economy thanks to a gravity-defying property boom and higher government infrastructure spending.

Data from NBS showed that industrial output climbed 7.6% annually, faster then the 6.5% increase logged in the prior period.

"The national economy performed within an appropriate range with more visible good momentum", the National Bureau of Statistics said.