China's Q2 economic growth cools to 3-1/2-year low as imbalances worsen

China's economic expansion cooled significantly in the second quarter, hitting a 3-1/2-year low as deepening imbalances and weakening demand weighed on growth. The country's Gross Domestic Product (GDP) expanded by 3.2% year-on-year, falling short of economists' expectations and signaling a challenging economic outlook.

The slowdown was evident across key economic indicators. Retail sales growth decelerated sharply to 3.1% in June from 12.7% in May, reflecting sluggish consumer spending. Industrial output also showed signs of weakness, growing by 4.4% in June, down from 5.6% in the previous month and below forecasts.

Analysts attribute the disappointing figures to a combination of factors, including a property sector downturn, subdued global demand for Chinese exports, and lingering effects of earlier COVID-19 disruptions. The data underscores the pressures facing China's economy and raises concerns about the effectiveness of current stimulus measures.