China's Economic Resilience Amid Trade Tensions
China's economy demonstrated resilience by growing 5.2% in the second quarter, slightly above expectations amid U.S. trade tensions. While growth supported by policy measures, concerns persist over property crises and low consumer confidence. Analysts caution that intensifying headwinds may necessitate further stimulus to sustain future growth.
China's economy exhibited unexpected resilience in the second quarter of 2023, with a GDP growth of 5.2%, slightly exceeding analysts' expectations amid persistent U.S. trade tensions. This performance, however, continues to face challenges such as ongoing property crises and inadequate consumer confidence.
Despite the modest economic expansion, experts warn that significant headwinds could lead to increased pressure on policymakers to introduce additional stimulus measures. Jeff Ng, Head of Asia Macro Strategy at SMBC in Singapore, notes that the market's muted reaction reflects expectations but voices concerns about a potential slowdown once tariffs are fully implemented.
Encouragingly, June saw a boost in industrial output and a rebound in imports, as Chinese firms expedited shipments under a precarious trade truce. Nonetheless, persistent issues like deflationary pressures and a looming property sector crisis continue to pose risks to sustained growth.
(With inputs from agencies.)
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