Chinese economy delivers pleasant second-quarter growth surprise

Chinese economy delivers pleasant second-quarter growth surprise

Chinese economy delivers pleasant second-quarter growth surprise

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. That was higher than analysts' expectations of a 6.8 percent expansion.

"The recent crackdown on financial risks has driven a slowdown in credit growth, which will weigh on the economy during the second half of this year".

On a quarterly basis, the growth improved to 1.7% in the second quarter from 1.3% during the first quarter this year. All that could upset Beijing's main priority at the moment of maintaining stability and calm ahead of a major Communist Party leadership change.

In the first six months, crude oil output dropped 5.1 percent year on year to 96.45 million tonnes.

Analysts polled by Reuters had expected the economy to expand 6.8 percent in the April-June quarter.

The US dollar held near a 10-month low it hit on Friday after the release of dismal US inflation and retail sales data which raised bets the US central bank will be in less of a hurry to raise interest rates.

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Meanwhile, China's aluminum production rose 7.4 percent year-on-year in June to its highest level on records back to 2014.

"Overall, the economy continued to show steady progress in the first half.but global instability and uncertainties are still relatively large, and the domestic long-term buildup of structural imbalances remains", said the statistics bureau in a statement.

On the latter, the NBS said that overcapacity was "addressed in a well-ordered way" noting that capacity utilisation rates across the nation's industrial sector rose from a year earlier while real estate inventory "continued to be reduced".

"Based on this data, there is no need for easing and no need really for tightening either because inflationary pressures are very much contained".

Power output increased 6.3 percent year on year to 2.96 trillion kilowatt-hours in the first half of 2017, the NBS said. The trade surplus widened from $US40.8 billion in May to $US42.8 billion in June.

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