Chinese economy steady amidst slowdown worries

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Since the global financial crisis China has been a key driver of the global economy

India, on the other hand, is suffering from the impact of demonetization in the country. China prefers a steady pace, at least in its officially reported data. In the first half, retail sales advanced 10.4%.

Separate government figures also suggested that the Chinese economy seems to be holding up, despite persistent worries over the country's growing debts. Accounting sleight of hand may play some role.

"Overall, the economy continued to show steady progress in the first half...but worldwide instability and uncertainties are still relatively large, and the domestic long-term buildup of structural imbalances remains", the statistics bureau said.

"The immediate driver is much stronger industrial production, which is being lifted by many factors: recovering exports, very low inventory, robust retail sales and investment-led demand", said Gene Ma, chief China economist at the Institute of International Finance in Washington. The changes add the health, tourism and "emerging" sectors to the GDP calculation-the latter of which refers to the high-tech industry. But Xing Zhihong, a spokesman for the National Bureau of Statistics, said on Monday morning that this was a continuing project that had not been applied to the second-quarter growth statistics.

For the first six months, refinery production in the world's second-largest fuel consumer gained 3% from a year earlier to 275.21-million tonnes, or about 11.1-million barrels a day.

China's economy is holding steady.

As part of a broader effort to temper financial risks stemming from a build-up of debt since the 2009 financial crisis, Chinese authorities have slapped a flurry of cooling measures over the past year to defuse a housing bubble. More than half the credit in its economy consists of loans from state-controlled banks to state-owned enterprises. Those steps targeted at speculators in the biggest cities appear to be paying dividends.

Data from NBS showed that industrial output climbed 7.6% annually, faster then the 6.5% increase logged in the prior period.

Last quarter's growth momentum had continued into the current one, he said, noting that traditional economic indicators such as power generation and consumption, and new business orders had increased "significantly". In that respect, there were a few clouds on China's horizon.

Economists in Reuters' poll forecast second quarter GDP to grow 1.7 percent from a quarter ago. Trade data released earlier showed export growth accelerated in May and June.

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