Gross domestic product (GDP) expanded 7.9 percent in the April-June period from a year earlier, official data showed on Thursday. The figure missed expectations for a rise of 8.1 percent in a Reuters poll of economists.

Growth slowed significantly from a record expansion of 18.3 percent in the January-March period, when the year-on-year (yoy) growth rate was heavily skewed by the coronavirus-induced slump in the first quarter of 2020.

June activity data slowed from the month before, but beat expectations.

"The numbers were marginally below our expectation and the market's expectation, (but) I think the momentum is fairly strong," said UOB economist Woei Chen Ho in Singapore.

"Our greater concern is the uneven recovery that we've seen so far, and for China, the recovery in domestic consumption is very important [...] retail sales this month was fairly strong, and that may allay some concerns," she added.

Read also: China industrial output, retail sales surge in pandemic rebound

While the world's second largest economy has rebounded strongly from the COVID-19 crisis, buoyed by solid export demand and policy support, data in recent months suggest some loss in momentum. Higher raw material costs, supply shortages and pollution controls are weighing on industrial activity, while small COVID-19 outbreaks have kept a lid on consumer spending.

Investors are watching to see if the People's Bank of China shifts to an easier policy stance after the central bank announced last week it would cut the amount of cash that banks must hold as reserves.

The move released about 1 trillion yuan (US$154.64 billion) in long-term liquidity to bolster recovery, and came even as policymakers sought to normalise policy after the economy's strong rebound from the coronavirus crisis to contain financial risks.

GDP expanded 1.3 percent on a quarterly basis in the April-June period, the National Bureau of Statistics (NBS) said, just beating expectations in the Reuters poll for a 1.2 percent rise. The NBS revised down growth in the first quarter from the fourth quarter last year to 0.4 percent.

NBS data also showed China's industrial output grew 8.3 percent in June from a year ago, slowing from an 8.8 percent rise in May. Economists in the Reuters poll had expected a 7.8 percent yoy rise.

Retail sales grew 12.1 percent from a year earlier in June, while analysts in the Reuters poll had expected a 11.0 percent increase after a 12.4 percent rise in May.

"The domestic economic recovery is uneven," Liu Aihua, an official at the NBS, said at a briefing on Thursday.

"We must also see that the global epidemic continues to evolve, and there are many external instabilities and uncertain factors," she said.

Data earlier this week showed China's exports grew much faster than expected in June, but a customs official said overall trade growth might slow in the second half of 2021, partly reflecting pandemic uncertainties.

Economists in the Reuters poll expected an 8.6 percent GDP expansion in 2021, which would have been the highest annual growth in a decade and much higher than the country's official growth target of above 6 percent. China was the only major economy to avoid a contraction last year, instead expanding 2.3 percent.

Premier Li Keqiang reiterated on Monday that China would not resort to flood-like stimulus.

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Still, economists in the Reuters poll expected more support this year, forecasting a further cut in the bank reserve requirement ratio (RRR) in the fourth quarter.

Fixed asset investment grew 12.6 percent in the first six months from the same period a year earlier, compared to a forecast 12.1 percent uptick, and down from a 15.4 percent jump in January-May.

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