China reported Monday that its second-quarter GDP increased by 6.3% year on year, falling short of estimates. In June, the unemployment rate among young individuals aged 16 to 24 was 21.3%, a new high.

The second-quarter GDP figure of 6.3% was a 0.8% increase over the first quarter, slower than the 2.2% quarter-on-quarter pace achieved in the first three months of the year. Reuters polled analysts, who anticipated a 7.3% growth in second-quarter GDP.

China has a difficult geopolitical and economic international environment, according to National Bureau of Statistics spokeswoman Fu Linghui. He also stated that China can still meet its full-year growth target. Beijing announced a 5% growth target for 2023 in March.

Retail sales increased by 3.1% in June, slightly less than the 3.2% projected. Catering, sports and entertainment products, as well as alcohol and cigarettes, saw the greatest increase in retail sales. In June, sales of automobiles, office supplies, and consumer items fell from the previous year. According to CNBC calculations based on government statistics available through Wind Information, online sales of tangible goods increased by 6.7% year on year in June, slower than in May.

Industrial production increased by 4.4% year on year in June, exceeding the 2.7% projection.

Fixed asset investment increased by 3.8% in the first half of the year, exceeding the 3.5% projected.

Within fixed asset investment, real estate investment declined more year to date in June than in May. Manufacturing investment increased steadily, whereas infrastructure investment decreased.

In June, the urban jobless rate stood at 5.2%.

When questioned about the prognosis for the second half, spokeswoman Fu predicted that real estate investment will remain low for the foreseeable future.

He also predicted that youth unemployment would grow further before falling after August.

China’s Covid-19 control terminated in December. An initial economic recovery has stalled. The enormous real estate sector has struggled to revive, while exports have plummeted as worldwide demand has declined.

Prices in China remained unchanged in June due to weak consumer demand. Last week, the People’s Bank of China predicted a drop in July, but that inflation would rise later this year.

Domestic travel has been a ray of sunshine in the recovery. According to the Ministry of Culture and Tourism, urban dwellers more than doubled their tourism spending in the first half of the year, to 1.98 trillion yuan ($280 billion). However, it stated that rural dwellers’ travel spending increased by just approximately 40% throughout same time period.

Official records show that the combined first-half total of 2.3 trillion yuan was smaller than the 2.78 trillion yuan reported for the first six months of 2019, before the outbreak.

Beijing announced this week that it will prolong its property support measures. The government has also offered wide support for exports. The country has also extended tax benefits for the purchase of electric vehicles, a developing industry that the government is eager to assist.

However, Beijing has shown reluctance to engage on additional stimulus, particularly as local government debt has risen. A Politburo meeting later this month may provide more information on economic policy.

(Adapted from CNBC.com)

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