China economic growth steady in second quarter

Economic growth in China was steady over the second quarter of the year, official data revealed.

Gross domestic product in Asia's largest economy expanded at a 6.9% year-on-year clip in the three months to June, according to the National Bureau of Statistics.

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

In terms of quarterly rates of change, GDP picked up from 1.3% to 1.7%.

Julian Evans-Pritchard at Capital Economics voiced skepticism about the reliability of the official data.

Nonetheless, according to the research house's own China Activity Proxy, which was designed to give more reliable readings, Chinese GDP was in fact little changed in the second quarter, slowing from a 6.5% pace to 6.3%.

Separate readings on industrial production, fixed asset investment and retail sales for June all came in ahead of forecasts.

Industrial production grew at a 7.6% year-on-year clip last month, after increasing by 6.5% in May (consensus: 6.5%).

Retail sales also exceeded forecasts, printing at 11.0% year-on-year (consensus: 10.6%) versus 10.7% in May.

Fixed asset investment year-to-date came in at 8.6%, the same as in May (consensus: 8.5%).

Monday's data led Evans-Pritchard to conclude that the Chinese economy was holding up well going into the third quarter of the year.

However, he did not expect that strength to last due to the recent crackdown on financial risks - which had led to slower credit growth.

Furthermore, the Financial Work Conference which concluded at the weekend had signalled that further regulatory tightening was on the horizon.