China’s gross domestic product (GDP) for the second quarter of this year cheered market participants while industrial production fell during the month of June. Underlying growth seems to be weakening after a strong development last year, as the drop in IP growth is showing signs of.
According to National Bureau of Statistics (NBS), Chinese GDP rose by 1.8 percent q/q in Q2, while the y/y growth rate fell by 0.1 percentage point to 6.7 percent y/y from Q1 to Q2.
Further, industrial production rose by 6.0 percentage y/y in June, while consensus had expected an increase of 6.5 percent y/y. Growth has slowed by 1 percentage point from April to June. The slowdown was broad based with a fall in the y/y growth rates for electricity, steel and glass, cement and iron ore.
In addition, retail sales rose by 9.0 percent y/y in June, up from 8.5 percent in May and higher than consensus’ expectations of an increase of 8.8 percent. Adjusted for price changes sales rose by 7.0 percent y/y, up by 0.2 percentage point from May.
