China’s economic growth holds steady despite slowdown fears

China’s economic growth holds steady despite slowdown fears

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China’s economic growth held steady in the latest quarter, boosted by trade and consumer spending, despite concerns about a possible impending slowdown.

Output rose 6.9% in the three months ending in June compared with a year earlier, government data showed. That was in line with the previous quarter and exceeded some forecasts.

Communist leaders are eager to keep economic conditions steady as they head into a ruling party congress later this year at which President Xi Jinping is due to be named to a second five-year term as leader. But growth is being pressured as Beijing tightens controls on bank lending to rein in a surge in debt levels.

Forecasters expect economic growth to cool later this year as those credit controls take hold, depressing investment.

The International Monetary Fund has forecast China’s full-year growth for 2017 to hold steady at last year’s level of 6.7% due to strong government spending.

Consumer spending and trade growth both accelerated during the second quarter, helping to offset softening investment in factories, real estate and other fixed assets.

Retail sales rose 10.4% in the first half of the year, up 0.1 percentage points from the first quarter’s rate. Trade data released earlier showed export growth accelerated in May and June.

Investment, the biggest single component of economic growth in recent years, rose by 8.6% in the first half of the year, but that was down from 0.6% from the first quarter’s expansion.

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