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China's economy still on track despite Q2 growth slowdown

BEIJING, July 15 (Xinhua) -- Newly-released economic data confirmed market expectations that China's economic growth rate has slowed but officials said the country's economy is still on track.

China's economy expanded at a 10.3-percent rate in the second quarter, slower than both the 11.9-percent growth in the first quarter and the 10.7-percent growth in the fourth quarter of last year, the National Bureau of Statistics (NBS) said Thursday.

The slowdown, which the government expected, will help accelerate the transformation of the economic growth pattern and prevent economic overheating, NBS spokesman Sheng Laiyun told a press conference.

Although the pace of the second-quarter growth slowed, it was still strong growth, Sheng said.

According to preliminary statistics, China's gross domestic product (GDP) hit 17.28 trillion yuan (2.55 trillion U.S. dollars) in the first six months of this year, up 11.1 percent from a year earlier.

The growth rate was 3.7 percentage points higher than in the same period last year, when the country's economy was still wrestling with the effects of the global financial crisis.

"China's economy generally performed well in the first half and has developed according to the government's macro regulation," Sheng said.

The government has set an annual economic growth target of around 8 percent for 2010.

Inflation eased in June. China's consumer price index (CPI) slowed to a 2.9 percent rise from 3.1 percent in May. The figure was below market estimates, which ranged from 3.1 percent to 3.5 percent.

The Producer Price Index (PPI) grew 6.4 percent year on year in June, lower than May's increase of 7.1 percent.

Other data released Thursday also pointed to a slowdown, with growth rates for industrial production, consumption and investment all easing.

China's industrial value-added output grew 13.7 percent in June, down from a 16.5-percent increase in May.

Retail sales expanded 18.3 percent last month, slowing from May's 18.7 percent.

Urban fixed asset investment was up 25.5 percent in the first six months, after a 25.9-percent gain in the January-May period.

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