China publishes figures for the second quarter of the year, but the data are not entirely favorable.
July 15, 2021, | AtoZ Markets-The Gross Domestic Product of the second largest economy in the world was 7.9% in the second quarter of the year. This figure was below the expectations created by the market.
The National Bureau of Statistics of China is in charge of publishing official figures for the country. The decline in growth in the second quarter reflects the difficulties that the Asian country is currently experiencing.
What were the published data?
According to the preliminary estimates, the gross domestic product (GDP) of China in the first half year was 53,216.7 billion yuan, a year-on-year increase of 12;7% , and 5,6% lower than that of the first quarter.
The average two-year growth was 5,3%, 0.3 percentage points faster than that of the first quarter. By quarter, the year-on-year GDP growth for the first quarter was 18,3%, with an average two-year growth of 5,0%.
For the second quarter was of 7,9 %, with an average two-year growth of 5.5%. Also, the quarter-on-quarter GDP growth of the second quarter was 1.3%.
China’s economy sustained a steady recovery with the production and demand picking up, employment and prices remaining stable, noted deNational Bureau of Statistics of China .
According to the statement, “The national economy witnessed the steady and sound growth momentum consolidated.”
In June, the total retail sales of consumer goods reached up by 12.1% year on year, with an average two-year growth of 4,9%, or up by 0.70 percent month on month.
Retail sales growth has lagged that of the overall economy, and missed analysts’ expectations for the first two months of the second quarter.
Consumption declined year-on-year in May for four provincial capitals — Wuhan, Guiyang, Shijiazhuang and Yinchuan — according to analysis of public data by Pinpoint Asset Management.
In the first half year, analyzed by different areas, the retail sales of consumer goods in urban areas reached up by 23,3% year on year with an average two-year growth of 4,4%, and the retail sales of consumer goods in rural areas stood at up by 21.4% with an average two-year growth of 4,0%.
China’s Trade Balance
In the first half year, the total value of imports and exports of goods was increase of 27%1 year on year. The total value of imports was up by 25,9% year on year, and the trade balance was 1,633.6 billion yuan in surplus.
The total value of exports was 9,849.3 billion yuan, up by 28,1% year on year, and the trade balance was 1,633.6 billion yuan in surplus.
The trade structure continued to improve. In the first half year, the exports of mechanical and electrical products accounted for 59,2% of the total value of exports, up by 0,6% points over the same period last year.
Why Is China Important to Forex Traders?
China is an ancestral country with important traditions and today is considered the world’s second largest economy. Its currency, the Yuan or Renminbi, plays an important role in world financial markets.
Moreover, as China is a major export and import platform, its currency is strongly linked to the U.S. dollar. If we follow the dollar closely, we will know what is happening with the Chinese Yuan.
On the other hand, the political reforms that the government has been implementing make its currency more and more attractive.
Meanwhile, a good performance of the Chinese economy will not only influence its currency, but also the currencies of its principal trading partners.
Remember: The symbol used to represent the yuan is ¥ and there are three codes in Forex related to this currency:
- CNH (which refers to the offshore negotiable currency).
Have you ever traded with Yuan? Tell us what was your experience?
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