As policymakers in Beijing aim to reverse a stock market plunge that threatens to disrupt its economic reform plans, China’s economy posted 7 per cent growth year on year in the second quarter of 2015, unchanged from the first quarter, the National Bureau of Statistics (NBS) announced on Wednesday.
The growth rate beat a median market forecast of 6.9 per cent for the second quarter, as authorities cited “positive signs” in the economy.
Second-quarter GDP grew 1.7 per cent over the previous quarter, NBS data showed.
The better-than-expected growth has come after the government’s bold moves in macro-control and adherence to structural reforms as the economy plateaus, NBS spokesperson Sheng Laiyun said at a press conference.
“Policies rolled out by central authorities to stabilize growth, boost reforms and restructuring, improve livelihoods and prevent risks have played significant roles for the economy,” Sheng said.
These measures included three cuts in both benchmark interest rates and banks’ reserve requirement ratio in the first half, and the government’s accelerated fiscal spending on infrastructure to shore up investment. China has cut interest rates four times since November
With these efforts, the national economy has stayed “in the proper range” in the first half as major economic indicators gradually recovered, indicating stabilization and improvement,” Sheng said, citing steady employment and price levels.
More than seven million new jobs were created in urban areas in the first half, with a target of 10 million for the year, while inflation rose only 1.3 per cent during the period.
In the first half of the year, GDP hit 29.7 trillion yuan ($4.9 trillion), up 7 per cent year on year, according to NBS data.
During the same period, industrial output grew 6.3 per cent year on year and fixed-asset investment climbed 11.4 per cent. Property investment grew 4.6 per cent, while retail sales of consumer goods rose 10.4 per cent.
Sheng added that the annual industrial output growth has accelerated since April while fixed asset investment also rebounded in the past two months, reversing a previous slowdown.
“We think economic growth in the latter half of the year will most likely outperform that in the first half,” the spokesperson said, forecasting that government pro-growth policies in the first half will have more of an effect later this year.
Speaking during a meeting with economists and entrepreneurs on Friday,Chinese Premier Li Keqiang said China’s economy still boasts “remarkable tenacity, potential and flexibility”.