China’s economy seen growing at 6.7 percent in Q2 – report

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China’s economy will grow by around 6.7 percent in the second quarter of 2016, same as recorded in the first quarter, a leading Chinese think tank has said.

The State Information Center, an institution affiliated with the National Development and Reform Commission, predicted that with infrastructure investment and the real estate sector gaining steam, the Chinese economy is likely to stabilize in the next six months, Xinhua news agency said in a report.

The country’s economy grew 6.7 percent year on year in the first quarter, with growth narrowing from 6.8 percent in the previous quarter – the lowest three-monthly rise since the 2008 global financial crisis.

The State Information Center said indicators including output of cars and crude steel, power generation and industrial added value have shown the economy beginning to stabilize, the report said.

It said the government will spend 1.2 trillion yuan ($184 billion) on infrastructure this year, and that will attract further investment worth 6 trillion yuan.

Meanwhile, land and housing sales continue to increase. Although the property inventory is still excessive, the report sees real estate investment picking up in the short run.

The State Information Center singled out the service sector as a bright spot, with consumer spending on leisure, health care and information services increasing. This sector should expand at around 7.5 percent in the second quarter, it said.

While consumer demand is stabilizing, slower income growth and the lackluster job market cast a long shadow. The report estimated retail sales of consumer goods will grow by around 10.5 percent in the April-June period.

 

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