Chinese growth slows to three year low of 7.6%
China’s economy grew at its slowest pace since 2009 in Q2, with GDP up 7.6% on the same period last year.
This figure is down from 8.1% in Q1 as investment slowed and demand fell in export markets such as the US and Europe.
The Chinese government already moved to cut its growth target for the whole of 2012 to 7.5% in March.
China’s central bank also recently cut the amount of money banks must keep in reserve in order to boost lending, and reduced interest rates twice in one month to try stimulating the economy.
There was some more positive data as according to official figures, retail sales increased by 13.7% in June, which is little changed from May’s 13.8% figure.
Meanwhile, electricity output, an indicator many analysts use to calculate current business and consumer activity, was also flat in June at 393bn kilowatt-hours.
New bank loans also increased to $144.4bn in June, from $124.4bn in May.
Markets in Asia held up on the news, with the figures not as bad as some analysts had feared. Japan’s Nikkei 225 index was up 0.1% to 8,730.28 while Hong Kong’s Hang Seng rose 0.4% at 19,103.18.
“I’m relatively positive,” Louise Qian of the Economist Intelligence Unit in Beijing told the Times. “Although it is a slowdown, it is still above the government’s 7.5% overall target and we believe things will pick up in the second half of the year.”
This article was first published on Investment Week