China second quarter GDP growth tops forecasts on strong investment, consumption

China's economy grew faster than expected in the second quarter as industrial output and consumption picked up and investment remained strong, though analysts expect slower growth over the rest of the year as policymakers seek to reduce financial risk.

The economy grew 6.9 percent in the second quarter from a year earlier, the same rate as the first quarter, the National Bureau of Statistics said on Monday. Analysts polled by Reuters had expected the economy to expand 6.8 percent in the April-June quarter. 

On a quarterly basis, growth picked up to 1.7 percent from 1.3 percent in the first quarter, in line with expectations. 

Strength in retail sale and industrial output data helped offset a weak start for China stocks, which may have been linked to talk of tighter financial regulations. 

Growth in China's economy this year has beaten expectations as exports recover and property construction remains strong, though many analysts expect the world's second-largest economy to lose steam later in the year as policy measures to rein in red-hot housing prices and a rapid build-up in debt take a greater toll on growth. 

"Overall, the economy continued to show steady progress in the first half...but international instability and uncertainties are still relatively large, and the domestic long-term buildup of structural imbalances remains," the statistics bureau said in a statement with the data. 

China's factory output grew 7.6 percent in June from a year earlier, the fastest pace in three months, while fixed-asset investment expanded 8.6 percent in the first six months of the year, both beating forecasts. 

Retail sales rose 11.0 percent in June from a year earlier, the fastest pace since December 2015 and beating analysts' expectations for a 10.6 percent rise.