|Year-on-year growth in the world's second-largest economy has slowed for four straight quarters [EPA]
China has announced its slowest rate of quarterly growth in two-and-a-half years as efforts to tame high inflation and global turbulence affected the world's second largest economy.
The government said on Tuesday that economy achieved 8.9 per cent growth in the fourth quarter of 2011, the slowest expansion since the second quarter of 2009, when the economy grew 7.9 percent.
China's economy grew 9.2 per cent overall in 2011, down from 10.4 per cent in 2010, but analysts said the economy, which is heavily dependent on exports, appeared on track to avoid the "hard landing" of an abrupt slowdown despite reduced demand from the US and Europe.
"It's slowing, even though it's not particularly aggressive. The economy seems to be surprisingly resilient so far," said Stephen Green, a researcher with for Standard Chartered Bank in Hong Kong.
Output from the country's millions of factories and workshops rose 13.9 per cent for all of 2011, a slower pace than in 2010.
Year-on-year growth has slowed for four straight quarters as Beijing, anxious about soaring costs, has restricted lending and pushed up interest rates.
Nonetheless the growth beat a forecast of 8.6 per cent by analysts polled by Dow Jones Newswires.
Better than expected
Adrian Foster, from Rabobank in Hong Kong, told Al Jazeera that even though the growth had slowed, it was "still a pretty robust growth rate".
"The US is growing at around two per cent and Europe is in a recession, but it will take a little bit of selling to convince the domestic market," Foster said.
"China actually lost momentum early in 2011 and going into 2012, we can expected to see growth in the eight to nine per cent range, as this is about right."
Li Huiyong, economist at Shenyin Wanguo Securities in Shanghai, said the latest figures would be welcomed in Beijing.
"This indicates our economy is still good and quite stable, and a soft landing for the economy is more possible. Therefore, the government is likely to postpone the next policy easing move," he said.
In a bid to boost growth and counter the slowdown in export demand, authorities in December cut the amount of money banks must hold in reserve for the first time in three years.
Some analysts had expected the government to move again to loosen credit as early as this month, but stronger-than-expected growth in the fourth quarter could give policy-makers breathing room.
In a positive sign, growth in retail sales increased to 18.1 per cent in December from November's 17.1 per cent.
"If we can rely more on domestic consumption, that will help the economy to sail through all these headwinds," said Frances Cheung of Credit Agricole CIB in Hong Kong.
"In retail sales, there is quite an obvious pickup in growth, so that is where I think the comfort will come from."
Source: Al Jazeera and agencies