China’s 1H GDP Expands Slowest Since 2020, However Key Indicators Show Bright Spots

China’s gross domestic product expanded 2.5 percent year on year in the first half of 2022, as reported by the National Bureau of Statistics, this is the worst data to come from the country since the start of the pandemic in 2020.

Second quarter results were also dire with the country’s GDP growing just 0.4 percent year on year, signaling a relook at its projected forecast for the whole year, Fu Linghui a spokesperson for NBS said: “there are challenges for us to achieve the whole year GDP targets.”

The poor performance is reflected in the Omicron outbreak and the zero policy adopted by the government, however, there is an indication that China could be looking to ease its strict view on the virus.

China’s economy has shown a stabilising trend despite downward pressures in the second quarter (Q2) brought by the complex global environment and domestic COVID-19 resurgences.

Here are some highlights of the economy amid the government’s efforts to curb the COVID-19 resurgences and boost economic and social development.

Despite steep falls of major economic indicators in April, China’s gross domestic product (GDP) secured a positive growth of 0.4 percent year on year in Q2, thanks to a slew of supportive policies that quickly took effect in the following months.

In the first half (H1) of 2022, China’s GDP rose 2.5 percent year on year. China’s value-added industrial output went up 3.4 percent year on year in H1.

In June, industrial output growth increased to 3.9 percent year on year, rising by 3.2 percentage points from that in May.China’s June consumption reversed from declines seen in April and May. Retail sales of consumer goods went up 3.1 percent year on year in June.

Fixed-asset investment saw steady growth in H1, jumping 6.1 percent from a year earlier to 27.14 trillion yuan (about 4.02 trillion U.S. dollars).

Investment into the high-tech manufacturing and services sectors sustained growth momentum in H1, jumping 23.8 percent and 12.6 percent year on year.

Foreign trade registered robust growth in June, accelerating to 14.3 percent year on year, compared with 9.5 percent in May and 0.1 percent in April.

From January to June, China’s foreign trade of goods jumped 9.4 percent year on year to 19.8 trillion yuan. China’s consumer inflation remained stable in June, with a rise of 2.5 percent year on year.

Factory-gate inflation continued to ease, with an increase of 6.1 percent year on year, down 0.3 percentage points from the previous month. Employment has improved, with the surveyed urban unemployment rate standing at 5.5 percent in June, down from 5.9 percent in May.

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