China GDP data to show sharp slowdown in Q2, tepid recovery in June

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China GDP data to show sharp slowdown in Q2, tepid recovery in June
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China is expected to report a sharp slowdown in economic growth in the second quarter after widespread COVID lockdowns jolted factories and consumers, although activity in June may have perked up.

Data on Friday is expected to show gross domestic product grew 1% in April-June from a year earlier, a Reuters poll showed, slowing from the first-quarter's 4.8% pace.

"Anemic consumption remains the most daunting challenge owing to labor market strains because sporadic lockdowns have resulted in pay cuts and a hiring freeze." Still, activity data for June is expected to show some improvement, as the government has rolled out a raft of policy measures, cutting taxes for businesses and channeling more money into big-ticket infrastructure projects.Industrial output likely grew 4.1% in June from a year earlier, picking up from 0.7% in May, while retail sales, a gauge of consumption which has been lagging since COVID first hit, likely levelled off in June after falling 6.7% in May.

The Reuters poll forecast China's growth to slow to 4.0% in 2022, far below the official growth target of around 5.5%.

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