Staggering Chinese Economy... Second Quarter Report Below Expectations Despite Base Effects (Update)

Market Expected at 7% but Stalls at 6.3%
Domestic Demand Also Falls Short of Forecast, Showing Weakness
Youth Unemployment Rate Hits a New Record High of 21.3% Again

China's economic recovery delay has become a situation more severe than market concerns. The second-quarter economic growth rate fell far short of expectations, and the youth unemployment rate once again reached an all-time high.

On the 17th, the National Bureau of Statistics of China announced that China's gross domestic product (GDP) growth rate for the second quarter of this year was 6.3% year-on-year. The market had expected a growth rate in the 7% range for the second quarter of this year, considering that the GDP growth rate was only 0.4% in the second quarter of last year due to the Shanghai lockdown.

[Image source=Reuters Yonhap News]

The quarter-on-quarter growth rate recorded 0.8%, down from 2.2% in the first quarter. The market had anticipated around 0.5%. The total GDP growth rate for the first half of the year, combined with the first quarter, was 5.5%.

China's domestic demand recovery, which had been a source of hope, also showed sluggish trends. Retail sales in June, announced on the same day, increased by 3.1% year-on-year, slightly below the forecast of 3.2%. The retail sales growth rate in the first quarter was 12.7%. China's retail sales are a gauge of domestic economic activity, reflecting changes in various types of consumer spending such as department stores and convenience stores.

Industrial production in June increased by 4.4% year-on-year, surpassing the previous month's figure (3.5%) and the forecast (2.7%). China's industrial production measures the total output of factories, mines, and public facilities, reflecting manufacturing trends and serving as a leading indicator for employment and average income. Fixed asset investment increased by 3.8% year-on-year in June, exceeding the forecast of 3.5%. The fixed asset investment growth rate in the first quarter was 4.0%.

The youth (ages 16?24) unemployment rate, considered a trigger point for the Chinese economy, recorded 21.3%. This broke the previous record again, following May's 20.8%. The overall unemployment rate remained at 5.2%, stagnant for four consecutive months since March.

This content was produced with the assistance of AI translation services.