A technical recession is defined as two consecutive quarters of contraction in gross domestic product.

The data confirmed that China will be probably the first major economy to achieve positive economic growth, with the United States, the European Union as well as Japan still struggling to reopen their economies.

Mei Xinyu, a researcher with the Ministry of Commerce, said that China's economic output has “definitely” exceeded the US in the second quarter, given the downturn in the American economy.

“China’s whole-year GDP in 2020 could be slightly lower than that of the US,” Mei continued. “But if the domestic chaos in the United States escalates, China's whole-year GDP could exceed that of US this year.”

“The recovery in the second quarter is strong, but also highly uneven,” said Larry Hu, chief China economist at Macquarie Bank, referring to supply recovery being stronger than demand, and investment being stronger than consumption.

“Looking ahead, while the growth momentum would slow inevitably, GDP growth could rebound to around 5 per cent on year in the second half [of 2020].”

China’s growth could also lend credibility to Beijing’s claims that its approach in containing the outbreak, including draconian control over people movement and massive testing, provides the right balance between economic growth and pandemic control.

“The 3.2 per cent year on year expansion of China’s GDP in the second quarter underscores the robust recovery China’s economy is going through after the historic contraction of 6.8 per cent year on year in the first quarter,” said Louis Kuijs, head of Asia economics at Oxford Economics.

“We expect the upturn in China’s economy to continue in the second half of the year, supported by improved sentiment after the successful containment of Covid-19 and significant fiscal and monetary policy easing.”

In other figures released by the National Bureau of Statistics (NBS) on Thursday, industrial production, a gauge of manufacturing, mining and utilities, rose by 4.8 per cent in June after a 4.4 per cent rise in May. This was in line with expectations of a 4.8 per cent increase, according to the Bloomberg survey.

Retail sales, a key measurement of consumption in the world’s most populous nation, fell by 1.8 per cent, better than the 2.8 per cent decline in May but below the forecast of a 0.5 per cent rise estimated in the Bloomberg survey.

Fixed asset investment, a gauge of expenditures on infrastructure, property, machinery and equipment, fell 3.1 per cent in the first six months of the year, an improvement from the 6.3 per cent decline in the first five months. Analysts had forecast a 3.3 per cent slump in the January-June period.

The surveyed jobless rate in urban areas stood at 5.7 per cent in June. This was down from 5.9 per cent in May and the recent peak of 6.2 per cent in February. The June reading was below the Bloomberg survey for a rise of 5.9 per cent.

China’s government has set a target of creating 9 million new urban jobs in 2020, compared to 11 million last year, and maintaining a surveyed urban unemployment rate of around 6 per cent, compared to 5.5 per cent last year. In 2019, China created 13.52 million new urban jobs.

“In terms of accumulated growth rate in the first half, no matter GDP, industrial output, service sector, investment or retail sales, most economic indicators were still in negative territory, so we judge the rebound [in the second quarter] as restorative growth,” said NBS spokeswoman Liu Aihua.

“There is still a way to go for fully making up the loss of the pandemic. [But the recovery in the first half] showed that the impact of the pandemic is controllable.

“We have confidence in a continued economic recovery in the second half, which has the foundation, potential and conditions to be achieved.”

Additional reporting by Bloomberg