Chinese growth slows to + 7.9% in June on an annual basis in the second quarter. The rebound decreased from the explosive + 18.3% recorded in the previous quarter. The increase is 1.3%, reflecting post-Covid normality. Meanwhile, the Central Bank today gives the green light to the liquidity operation by cutting 0.5% of the reserves of the interbank system. Officially the maneuver is linked to the need to support SMEs in trouble, in reality there is the problem of the enormous corporate debt in maturity. Thus Beijing officially enters the crowded club of nations that have adopted stimulus policies.
Return to normal growth
GDP in the first half of the year was 53.2 trillion yuan (8.2 trillion dollars), an annual increase of 12.7%. The growth momentum of the previous quarter attenuated following a “stable and solid” trend consolidated at + 7.9% in June on an annual basis in the second quarter. The rebound decreased from the explosive + 18.3% recorded in the previous quarter. The increase is 1.3%, reflecting post-Covid normality.
Industrial production increased by 0.56% on the month and 8.3% on the year, in May it had increased by 8.8% annually. In the first half of the year, industrial production grew by 15.9% on the year. The production of the extractive industry in the first half increased by 6.2% and the manufacturing one increased by 17.1%.
China’s fixed asset investments, excluding those made in the rural sector, have risen since the beginning of the year by 12.6% year on year. The figure was better than the expected + 12.1% but slowed down compared to the previous jump of 15.4%.
In June, China’s retail sales jumped 12.1% year-on-year, more than the expected 11% rise. Notably, beverage retail sales jumped 29.1% year-on-year.