National Bureau of Statistics (NBS): GDP up 4.7% YoY in H1, national economy operating within a reasonable range, new momentum growing rapidly

The National Bureau of Statistics (NBS) released data showing that according to preliminary estimates, China's gross domestic product (GDP) in H1 reached 69,570.4 billion yuan, up 4.7% YoY at constant prices. By industry, value-added of the primary sector was 3,152.2 billion yuan, up 3.7% YoY; that of the secondary sector was 25,047.3 billion yuan, up 3.9%; and that of the tertiary sector was 41,370.9 billion yuan, up 5.2%. By quarter, GDP in Q1 grew 5.0% YoY, and Q2 grew 4.3%. On a QoQ basis, GDP grew 0.9% in Q2. Overall, the national economy performed within a reasonable range in H1, new quality productive forces were nurtured and strengthened, and high-quality development advanced toward greater innovation and excellence. At the same time, it should be noted that there are many external factors of instability and uncertainty, the contradiction of strong supply and weak demand in China is prominent, and the foundation for economic improvement still needs to be consolidated. In the next stage, China will adhere to the principle of seeking progress while maintaining stability, improving quality and efficiency, intensify counter-cyclical and cross-cyclical adjustments, continue to expand domestic demand and optimize supply, optimize new drivers and revitalize existing assets, strive to build a strong Chinese market, accelerate the cultivation and growth of new growth drivers, redouble efforts to stabilize employment, enterprises, markets, and expectations, and promote effective improvement in the quality and reasonable growth of the quantity of the economy.

H1 Economy within Reasonable Range; New Growth Drivers Grow Rapidly

In H1, under the strong leadership of the Central Committee of the Communist Party of China with Comrade Xi Jinping at its core, various regions and departments earnestly implemented the decisions and arrangements of the Party Central Committee and the State Council, adhered to the general principle of seeking progress while ensuring stability, fully and faithfully applied the new development philosophy, accelerated the formation of a new development pattern, focused on promoting high-quality development, effectively implemented more proactive macro policies, and the economy withstood pressure and performed within a reasonable range; production supply grew relatively fast, the employment situation remained generally stable, prices rose mildly, foreign trade saw sound growth momentum, new growth drivers grew rapidly, people's livelihoods were effectively ensured, and the resilience of development was continuously demonstrated.

According to preliminary estimates, China's GDP in H1 reached 69,570.4 billion yuan, up 4.7% YoY at constant prices. By industry, value-added of the primary sector was 3,152.2 billion yuan, up 3.7% YoY; that of the secondary sector was 25,047.3 billion yuan, up 3.9%; and that of the tertiary sector was 41,370.9 billion yuan, up 5.2%. By quarter, Q1 GDP grew 5.0% YoY, and Q2 grew 4.3%. On a QoQ basis, GDP grew 0.9% in Q2.

I. Bumper Summer Grain Harvest, Steady Growth in Livestock Farming

In H1, value-added of agriculture (planting) grew 3.6% YoY. National summer grain output totaled 150.75 million mt, an increase of 1 million mt, or 0.7%, from the previous year. In H1, the output of pork, beef, mutton, and poultry reached 50.5 million tonnes, up 4.3% YoY. Within this, pork output was up 3.3% and poultry up 9.4%, while beef output was down 1.0% and mutton down 3.9%. Milk output increased 2.4%, and egg output declined 2.2%. At the end of Q2, the pig inventory stood at 424.91 million head, up 0.1% YoY; in H1, the pig slaughter was 372.46 million head, up 1.7%.

2. Industrial Production Grew Relatively Fast, and Equipment Manufacturing and High-Tech Manufacturing Performed Well

In H1, the value-added of industrial enterprises above designated size increased 5.4% YoY. By sector, mining value-added rose 3.6% YoY, manufacturing was up 5.6%, and the production and supply of electricity, heat, gas, and water grew 5.5%. Equipment manufacturing value-added increased 9.3% YoY, and high-tech manufacturing value-added grew 13.3%, outpacing the overall growth of industrial enterprises above designated size by 3.9 and 7.9 percentage points, respectively. By ownership, the value-added of state-controlled enterprises was up 4.3% YoY; joint-stock enterprises grew 5.9%, and enterprises with investment from foreign investors and those from Hong Kong, Macao, and Taiwan rose 3.2%; private enterprises increased 4.6%. By product, the production of 3D printing equipment, lithium-ion batteries, and industrial robots rose 48.5%, 39.3%, and 28.0% YoY, respectively. In June, the value-added of industrial enterprises above designated size increased 5.3% YoY, 0.8 percentage points faster than in May, with a MoM growth of 0.76%. In June, the manufacturing PMI stood at 50.3%, up 0.3 percentage points MoM; the expectations index for production and business activities was 54.3%, up 0.4 percentage points. In the first five months, total profits of industrial enterprises above designated size reached 3,144 billion yuan, up 18.8% YoY.

3. Services Grew Steadily, and Modern Services Developed Well

In H1, the value-added of services increased 5.2% YoY. Within this, the value-added of leasing and business services, information transmission, software and IT services, financial services, and accommodation and catering grew 11.9%, 10.7%, 6.7%, and 5.0%, respectively. In June, the National Services Production Index rose 4.7% YoY, 0.3 percentage points faster than in May. Within this, the production indices of leasing and business services, information transmission, software and IT services, and financial services rose 9.7%, 9.6%, and 5.8%, respectively. In the first five months, the business revenue of service enterprises above designated size increased 6.6% YoY. In June, the Services Business Activity Index stood at 50.4%, up 0.1 percentage points MoM; the Services Business Activity Expectations Index was 56.0%, up 0.6 percentage points. Among these, the Business Activity Indices for sectors such as telecommunications, broadcasting, television and satellite transmission services, internet software and information technology services, monetary and financial services, and insurance remained in the high prosperity range of 55.0% and above.

4. Consumer Market Continued to Expand, with Rapid Growth in Service Retail Sales

In H1, the total retail sales of consumer goods and services grew 2.7% YoY, of which service retail sales rose 5.3%, and goods retail sales grew 1.1%. Within service retail sales, those of communication and information services, tourism consulting and leasing services, and cultural, sports, and leisure services grew rapidly. In H1, total retail sales of consumer goods reached 24,872.2 billion yuan, up 1.3% YoY. By location of business units, urban retail sales of consumer goods were 21,550.6 billion yuan, up 1.2% YoY; rural retail sales of consumer goods were 3,321.6 billion yuan, up 2.5%. By consumption type, retail sales of goods were 22,046.7 billion yuan, up 1.1% YoY; and catering revenue was 2,825.5 billion yuan, up 2.8%. Sales of basic living goods and some upgraded goods grew relatively fast. Retail sales of grain, oil and foodstuffs, clothing, footwear, hats, textiles, and communication equipment by enterprises above the designated size grew 7.4%, 6.7%, and 14.4% YoY, respectively. In June, the total retail sales of consumer goods reached 4,269.1 billion yuan, up 1.0% YoY, compared to a 0.6% decline in the previous month, and an increase of 0.38% MoM. In H1, China's online retail sales of goods and services totaled 10,071.5 billion yuan, up 5.2% YoY. Of this, online retail sales of goods were 6,429.6 billion yuan, up 4.8%, and online retail sales of services were 3,641.9 billion yuan, up 6.0%.

5. Fixed Asset Investment Declined, While Investment in Intellectual Property Products Accelerated

In H1, China's fixed asset investment (excluding rural households) was 22,637 billion yuan, down 5.7% YoY; when excluding real estate development, it fell 2.7%. Among this, investment in intellectual property products rose 9.4% YoY, accelerating by 1.5 percentage points compared to Q1. By sector, infrastructure investment fell 2.4% YoY, manufacturing investment declined 1.2%, and real estate development investment dropped 18.0%. The floor space of newly built commercial buildings sold nationwide was 401.4 million m², down 11.6% YoY; the sales value of newly built commercial buildings was 3,794.5 billion yuan, down 13.6%. By industry, investment in the primary industry grew 0.9% YoY, in the secondary industry declined 1.1%, and in the tertiary industry fell 8.4%. Private investment dropped 8.5% YoY; excluding real estate development, private investment fell 4.9%. Investment in high-tech industries grew 4.6% YoY. Specifically, investment in aviation, spacecraft, and equipment manufacturing, computer and office equipment manufacturing, and information services rose 23.3%, 8.1%, and 15.5% YoY, respectively. In June, fixed asset investment (excluding rural households) fell 0.37% MoM.

VI. Rapid Growth in Goods Imports and Exports, with Continued Optimization of Trade Structure

In H1, total goods imports and exports reached 25,468.6 billion yuan, up 16.9% YoY. Of this, exports were 14,731.4 billion yuan, up 13.4%, and imports were 10,737.2 billion yuan, up 22.1%. Imports and exports to countries jointly building the Belt and Road grew 14.8%. Imports and exports by private enterprises grew 17.0%, accounting for 57.0% of the total. Exports of mechanical and electrical products rose 20.1%, accounting for 63.5% of total exports. In June, total imports and exports reached 4,782.3 billion yuan, up 24.2% YoY, 7.3 percentage points higher than the previous month. Of this, exports were 2,820.7 billion yuan, up 20.8%, and imports were 1,961.6 billion yuan, up 29.4%.

VII. Mild Rise in Consumer Prices, YoY Increase in Industrial Producer Prices

In H1, the national consumer price index (CPI) rose 1.0% YoY. By category, prices of food, tobacco, alcohol and dining out fell 0.2% YoY; clothing prices rose 1.6%; housing prices fell 0.2%; household goods and services prices rose 1.9%; transportation and communication prices rose 1.8%; education, culture and recreation prices rose 1.2%; healthcare prices rose 2.0%; and prices of other goods and services rose 11.6%. Within food, tobacco, alcohol and dining out, pork prices fell 13.4%, grain prices fell 0.3%, fresh fruit prices rose 1.5%, and fresh vegetable prices rose 4.1%. In June, the national CPI rose 1.0% YoY and fell 0.3% MoM. In H1, the core CPI, which excludes food and energy prices, rose 1.2% YoY, with the June core CPI up 1.0% YoY.

In H1, the national industrial producer EXW prices rose 1.5% YoY. Specifically, in June, they rose 4.1% YoY, with the growth rate expanding by 0.2 percentage points from the previous month, and fell 0.3% MoM. In H1, the national industrial producer purchase prices rose 2.4% YoY, with a 6.4% YoY increase in June and a 0.2% MoM decline.

VIII. Generally Stable Employment Situation, Decline in Urban Surveyed Unemployment Rate

In H1, the averaged national urban surveyed unemployment rate was 5.2%. In June, the rate stood at 5.0%, down 0.1 percentage points from the previous month. The surveyed unemployment rate for the local registered labor force was 5.0%; for the non-local registered labor force, it was 4.9%, including 4.8% for the non-local agricultural registered labor force. The surveyed urban unemployment rate in 31 major cities was 5.0%, down 0.1 percentage point from the previous month. The average weekly working hours of employees in enterprises nationwide was 48.2 hours. At the end of Q2, the number of rural migrant workers totaled 192.27 million, up 0.5% YoY.

IX. Household Income Grew Steadily, with Rural Income Growth Outpacing Urban

In H1, the per capita disposable income of residents nationwide was 22,981 yuan, a nominal increase of 5.2% YoY and a real increase of 4.2% after deducting price factors. By permanent residence, the per capita disposable income of urban residents was 30,126 yuan, a nominal increase of 4.4% YoY and 3.4% in real terms; for rural residents, it was 12,699 yuan, a nominal increase of 6.4% YoY and 5.5% in real terms. By income source, the per capita wage income, net operating income, net property income, and net transfer income of residents nationwide increased nominally by 5.3%, 6.5%, 1.1%, and 5.8%, respectively. In H1, the ratio of per capita disposable income of urban to rural residents (with rural income as 1) was 2.37, narrowing 0.05 YoY.

Overall, in H1, the national economy operated within a reasonable range, new quality productive forces were cultivated and strengthened, and high-quality development advanced toward new and higher levels. However, it should also be noted that there are numerous external instabilities and uncertainties, the contradiction of strong supply and weak demand in the domestic market is prominent, and the foundation for economic recovery still needs to be consolidated. In the next stage, we must adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, persist in seeking progress while maintaining stability, improving quality and efficiency, intensify counter-cyclical and cross-cyclical adjustments, continue to expand domestic demand and optimize supply, improve incremental growth and revitalize existing resources, focus on building a strong domestic market, accelerate the cultivation and strengthening of new growth drivers, and step up efforts to stabilize employment, enterprises, markets, and expectations, thereby promoting effective qualitative improvement and reasonable quantitative growth of the economy.