Boost for economy as mainland fixed-asset investment grows 27pc

Capital spending on the mainland quickened last month, providing evidence that strong domestic demand is likely to help offset softening exports for the steady economic growth that policymakers seek to achieve.

Fixed-asset investment in urban areas rose 27.3 per cent in the first seven months from a year earlier, compared with 26.8 per cent growth in the first half, the National Bureau of Statistics said yesterday.

Meanwhile, the central bank said the economy was on a solid footing, despite weakening global demand, thanks to longstanding growth drivers such as urbanisation.

The country, the world's fourth-largest economy, was likely to retain its growth momentum in the second half of the year after growing 10.4 per cent in the first six months, the People's Bank of China said in its second-quarter monetary report.

Investors cheered the better than expected investment figures. The Shanghai Composite Index gained 0.56 per cent, snapping the five-day losing streak since the start of the Beijing Olympics on August 8.

The fixed-asset investment figures capped a week of economic data that confirms the mainland's export-oriented economy is facing a challenge of weakening global demand although mitigated by strong domestic consumption.