China's economy grew more than expected in 2Q

The economy returned to growth more than expected in the second quarter, cherishing the hope that the slowdown in the world's second largest economy stabilizes, but without overcoming concerns about the decline of private investment.

Chinese GDP expanded by 6.7% in the second quarter compared to the same period in 2015, the same level as the first three months of the year, announced on Friday the National Institute of Statistics (ONS).

The growth in the April-June period exceeds the average forecast of a panel of 17 analysts, which showed an increase of 6.6%.

"The national economy grew moderately, but stable and healthy," the ONS, confirming the GDP growth target of 6.5% to 7% and 2016.

Confidence in official statistics is, however, questioned the speed of disclosure, only two weeks after the end of a quarter, while the advanced economies need several months to evaluate the data.

In 2015, China's economy expanded by 6.9%, the lowest in 25 years.

good surprise

The data for the second quarter "is a good surprise, no doubt. But I think it is due to a significant acceleration of credit growth," said Klaus Baader, chief economist at Société Générale in Hong Kong.

"China moves to achieve its growth target," estimated Haibin Zhu, chief economist at JP Morgan, which pitted the industrial production that remains "very strong" to weak private investment.

Beijing is changing its economic model, trying to concentrate it in the expansion of domestic consumption after years of growth fueled by investments and exports.

Sales, indicating consumer spending, rose 10.6% in June, according to the Statistics Office, and investments in fixed assets, public spending indicator, increased by 9% in the first half.

The spokesman for the ONS, Sheng Laiyun also pointed out that the consumption represented 73.3% of GDP in the first half, and investments, 37%.

"Domestic demand remains the key factor to support the steady growth of the Chinese economy," he said. The share of services in GDP rose 54.1%, or 1.8% more than in the first half of the previous year.

Concern with the private sector

Private investment clearly fell during the first half, from 3.9% in May to 2.8% in June.

The spokesman attributed the setback to the excess capacity of traditional industries and the difficulties of private companies to have access to some markets and bank loans.

"The biggest concern is the current fall in investment in the private sector, a clear sign that companies are eager for the situation and the government's failure to implement the promised reforms," ​​believes Tom Rafferty, the Economiste Intelligence Unit.