Chinese economy slows down to 6.7% amid signs of stabilisation

China on Friday said that its economy continued to slow down in the first quarter this year, declining to 6.7% but in line with government targets amid claims by officials that several key indicators showed signs of stabilisation in the world's second largest economy.

The country's GDP grew 6.7% year-on-year to reach 15.9 trillion yuan ($2.4 trillion), data released by the National Bureau of Statistics (NBS) showed.

The growth further narrowed from the previous quarter's 6.8%, which was already the lowest quarterly rate in seven years.

Chinese economy logged 6.9% last year, the lowest in over two-and-a-half decades.

Officials however say that Q1 growth of 6.7% was in line with market expectations and remained within the government's targeted range between 6.5 and 7% for 2016.

New growth momentum is gathering and some major indicators have seen positive changes, NBS spokesperson Sheng Laiyun said at a press conference, calling the first-quarter performance "a good start" to this year.

The retail sales of consumer goods increased 10.3% in the first quarter year-on-year, which points to increase in consumer demand as China tried to reset its export-led economy to one based on services and consumption to halt the slowdown.

In March, retail sales were up 10.5% year-on-year, faster than the growth rate in the first two months this year.

The value-added industrial output, an important economic indicator, expanded 5.8% year-on-year in the first quarter, accelerating from the 5.4% increase for the January-February period, according to NBS data.

Fixed-asset investment rose 10.7% year-on-year in the first quarter, a faster expansion than last year's 10%. Investment in the property sector grew 6.2%, accelerating from 1% for the whole of 2015.

Industrial output expanded 5.8%, accelerating from the 5.4% increase for the January-February period.

The service sector grew 7.6%, outpacing a 2.9% increase in the primary industry and 5.8% in the secondary industry. It accounted for 56.9% of the overall economy, up 2 percentage points from a year earlier, Sheng said.

A prolonged industrial glut, sagging foreign trade and cooling property investment dragged down China's growth in 2015 to 6.9%, the slowest pace in 25 years.

Authorities have taken a slew of measures to mitigate the downshift, cutting interest rates, reducing taxes, slashing overcapacity and initiating reforms to improve efficiency.