China's 2.7% GDP growth in the second quarter falls short of forecasts

China's second-quarter GDP increased by 4.7% year over year, according to the National Bureau of Statistics on Monday, below estimates of a 5.1% growth, as per a Reuters poll. June retail sales increased 2% as opposed to the projected 3.3% growth, missing predictions as well. According to a report from Oxford Economics Lead Economist Louise Loo, "we estimate that discretionary retail spending fell at the sharpest sequential pace since the April 2022 Shanghai lockdowns."

Jul 15, 2024 - 06:56
Jul 15, 2024 - 07:02
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China's 2.7% GDP growth in the second quarter falls short of forecasts
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The company has revised its projection for China's GDP growth in 2024 to 4.8% from 4.4% in December 2023.

However, June's industrial production year-over-year increase exceeded forecasts, coming in at 5.3% as opposed to Reuters' estimate of 5%. June showed an 8.8% increase in value added in the high-tech manufacturing sector.

Expectations were met as urban fixed asset investment increased by 3.9% over the first half of the year. Real estate investment fell at the same 10.1% rate as June, while manufacturing and infrastructure investment slowed year over year in June compared to May.

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As to Oxford Economics' report published in late May, China's wealth tied to housing increased by 2.2% in 2023, a significant decrease from the 13% average annual growth rate of 2016 to 2021.

According to a news statement issued by the agency in English, "We must work harder to invigorate the market and stimulate the internal impetus."

Additionally, it demanded actions to "consolidate and enhance the momentum for economic recovery and growth, in order to guarantee the economy's sustained and sound development."

According to the agency, the urban unemployment rate in June remained at 5% from the previous month. The unemployment rate for non-schooling adults between the ages of 16 and 24 is usually released a few days after the aggregate number. The most recent data available indicated that in May, the young unemployment rate—which was 14.2%—remained high.

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According to the data, the average per capita disposable income of city dwellers for the first half of the year was 27,561 yuan ($3,801), indicating a nominal increase of 4.6% from the previous year.

Though nominally up 6.8%, rural households' disposable income expanded at a quicker rate—11,272 yuan—than that of urban dwellers.

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