Economists had been cutting their GDP forecasts leading up to the data release.
Chinese GDP grew 1.7% quarter-over-quarter, slightly below expectations for a 1.8% rise.
China's GDP is up 7.6% in the first half of the year. The official government target is for 7.5% growth in 2013.
The cash crunch in June is also expected to have impacted economic growth.
We also had other economic data out tonight.
Chinese industrial production was up 8.9%, below expectations for a 9.1% rise. Industrial production was up 9.3% in the first half of the year. The 10.8% rise in crude oil output, following the rise in crude oil imports suggests some improvement in investment activity.
All important year-to-date fixed asset investment (FAI) climbed 20.1%, missing expectations for a 20.2% rise. A breakdown showed that railway FAI slowed to 15.7%, from 24.2% in May, manufacturing FAI slowed to 15.2%, from 16.5%, and property FAI was up 19.4%.
Retail sales were up 13.3%, above expectations for a 12.9% rise. In real terms however, retail sales were up 11.7% in June, down from 12.1% the previous month. Retail sales were up 12.7% in the first half of the year.
Chinese electricity consumption was up 6.3% YoY in June to 438.4 billion kilowatt hours, and up 5.1% in the first half of the year.
National Bureau of Statistics spokesman, Sheng Laiyun, said that China is creating jobs despite the slowdown in the economy, according to Bloomberg.
"We’d like to reiterate our call of “Li Keqiang Put”, which means that in the first couple of years of Premier Li’s term, he may try to prevent a growth hard-landing and a financial crisis," wrote Bank of America's Ting Lu following the release.
"That’s why we expect Li’s cabinet will introduce some measures to arrest the slowdown (in yoy term) of growth in the next couple of quarters."
Markets will be watching to see if policymakers move to support their 7.5% growth target.
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