China: Growth momentum maintained - Natixis

Alicia Garcia Herrero, Chief Economist at Natixis, notes that China reported a growth of 6.9% in the second quarter, topping the market expectation as consumption spending continued to be the leading factor driving China’s economic growth.

Key Quotes

“Fixed asset investment recorded an 8.6% improvement and contributed more than 2% of GDP growth.”

“The government’s efforts to curb property prices continued to pay off as property market stabilized in June.”

“Exports and imports carried their strong momentum onto this quarter and climbed slightly more in June along with improved trade balance, thanks to a weaker USD and enhanced global demand.”

“Looking forward, given that central and local governments’ fiscal expenditures already surged to support growth in the first half, the economy is pressured to maintain the positive momentum. Hence, we forecast a higher but conservative growth of 6.7%, 0.2% higher than Beijing’s target.”