China’s gross domestic product (GDP), the world’s second largest economy, grew by approximately 4.3% year-on-year in the second quarter ending in June, according to data released by the National Bureau of Statistics on Wednesday morning, July 15. This compares to 5% growth in the first quarter and falls short of market expectations of 4.5%. It represents the slowest growth rate in three years, impacted by a sharp decline in investment and weak consumption, remaining below Beijing’s official target range of 4.5% to 5%.

The unemployment rate fell by 0.1 percentage point from May to 5%, while expectations were for it to remain stable at 5.1%. Retail sales rose by 1.0% year-on-year in June, compared to a 0.6% decline in May, the first drop since 2022, and better than expected.

Chinese industrial production grew by approximately 5.3% year-on-year in June, compared to 4.5% in May, exceeding expectations of 4.7%.

Fixed asset investment, in turn, contracted by 5.7% in the first six months, from 4.1% in June and compared to expectations of a 4.9% decline, as investment in real estate, infrastructure and manufacturing continued to fall by 18%, 2.4% and 1.2% respectively.