China has posted its weakest annual economic growth in the last 25 years.
According to China's National Bureau of Statistics, Gross domestic product expanded by 6.9% in 2015. The growth rate is a far from China's spectacular expansion in recent decades, but it almost matches the government's 7% target.
For the fourth quarter of 2015, China’s economy grew 6.8%, compared with the same period a year earlier. That's a touch below economists' estimate of 6.9% and the slowest rate since the dark days of the financial crisis in 2009.
After years of steady expansion, the world's second-largest economy is now decelerating. China’s government is trying to shift the growth engine away from manufacturing and debt-fueled investment toward the services sector and consumer spending.
Uncertainty over the form of the Chinese economy, a key driver of global growth, has hurt international markets lately. China isn't buying as many commodities as it once did, and the world is full with loosing oil exporters.
In a result, the country's currency, the yuan, has fallen against the dollar.
But the growth data released Tuesday didn't appear to trouble investors. The Shanghai Composite was broadly flat in morning trade and later rallied to close up 3.2%. The Hang Seng in Hong Kong gained 2.1%.
Some observers doubt the accuracy of China's GDP numbers, arguing they are being manipulated by government officials. Instead, they look at statistics including electricity consumption, railway freight volume and bank loans to gauge growth.
Julian Evans-Pritchard of Capital Economics said that "China's ability to continue to post such rapid and relatively stable growth, even as it has increasingly become a source of volatility in global equity and commodity markets, will undoubtedly attract a great deal of skepticism.".
Instead of 6.8%, Evans-Pritchard estimates growth in the fourth quarter was in reality closer to 4.5%. "We still think concerns about China's outlook are overdone and that the recent market volatility has been driven more by sentiment than by economic fundamentals," he said.
China's official growth numbers are expected to decline further in the coming years, a situation President Xi Jinping has called "the new normal."
