BIEJING - China put on a brave front as the economic juggernaut slumped to its lowest level in over a decade, dragged down by weaker than expected factory output and investments that raised risks of missing its official growth target.
The world's No. 2 economy grew at 7.5 per cent in the second quarter, down from 7.7 per cent in the first quarter and 7.9 per cent in the last quarter of last year.
But this was still a "stable performance", stressed statistics bureau spokesman Sheng Laiyun. The "moderate slowdown" was due in part to the new leadership's fine-tuning and reforms which allow for short-term pain, he told a press briefing on Monday.
Measures ranging from property market curbs to a clampdown on official entertainment spending to exiting from prior stimulus "will inevitably have some impact on growth in the short term", he explained. This can yield long-term benefits without undermining Beijing's priority of stable growth, he said.
"I believe meeting this year's growth target (of 7.5 per cent) is not a problem," he added.
Mr Sheng's reassurances, echoing recent comments by leaders like Finance Minister Lou Jiwei, signalled that while Beijing is prepared to tolerate slower growth of as low as 6.5 per cent, a hard landing is not in sight for now.
Global stocks rallied after investors who had feared a nasty surprise were relieved that the second- quarter figures were in line with forecasts. The Shanghai composite index rose 1 per cent.
Still, worries persist that China could be headed for a steeper decline in the coming quarters.
Growth might be "at risk of stalling", wrote IHS Global Insight analyst Xianfang Ren in a report.