China’s growth slides to weakest pace in almost 30 years

Gross domestic product rose 6.2.% in the April-June period from a year earlier, below the 6.4% expansion in the first quarter and matching economists’ estimates. (AFP pic)

BEIJING: China’s economy continued slowing in the second quarter, as fragile domestic output and continuing trade tensions pulled growth down to the weakest pace since the early 1990s.

Gross domestic product rose 6.2.% in the April-June period from a year earlier, below the 6.4% expansion in the first quarter and matching economists’ estimates.

In June, factory output rose 6.3%, retail sales rose 9.8%, while investment gained 5.8% in the first half of the year – all three beating estimates in further evidence that stimulus measures to curb the slowdown may be feeding through.

The slowdown underlines the pressure that Chinese policymakers face as they attempt to negotiate a deal with the US, while balancing the objective of job creation with the need to defuse financial risks at home.

Although Chinese negotiators are talking with their US counterparts again, there is no certainty that a deal will be reached in time to prevent further economic damage.

“Growth in the second quarter is quite weak,” said Ding Shuang, chief China and North Asia economist at Standard Chartered Bank in Hong Kong. “But for the rest of the year, we expect a moderate, tempered recovery” due to policy support.