Data from June Quarter Signals at Stabilizing Economy in China with Growth in Spending
A brighter spot was noticed in China's economy with reports showing that lending and consumer spending in the country moved up in the latter half of the June quarter. That signals at the success of stepped up monetary and fiscal policy by the Chinese government.
Gross domestic product in the second largest economy of the world increased 6.7 percent in Q2 compared to last year. It was also in line with analysts' expectation of 6.6 percent and government's full year growth target of minimum 6.5 percent.
Although investment slowed down but a rise in June's industrial output and retail data surpassed estimates. However, a different report from the central bank revealed the broad measure of new lending surpassed analysts' estimates.
This year's credit surge and recovery in the housing sector has signaled at growth but that raises questions regarding its long term sustainability.
Since October, the Chinese policy makers have maintained the benchmark interest rates at a record low as an effort to stabilize their growth objective and efforts to control debt risks along with trimming the trend of excess capacity.
To keep up with their plans to keep up with a minimum average growth level of 6.5 percent till 2020, leaders of China's Communist Party seek to fuel added growth drivers with more focus on technology and services and less dependence on traditional sectors such as coal and steel.