China economic growth holds steady as retail spending rises

Beijing has used higher government spending and infusions of credit to avert a sharper downturn and politically dangerous job losses.

Growth in service industries, boosted by a surge in real estate sales, accelerated to 7.5 percent from the previous quarter's 7.8 percent.

State media have warned China's economic outlook will be "L-shaped," meaning the downturn should bottom out but growth will not rebound to the double-digit rates of the past decade.

Beijing's reliance on credit to drive growth since the 2008 global crisis has led to a rapid runup in China's debt to the equivalent of 250 percent of gross domestic product, high for a developing economy.

Regulators announced plans last week to allow "high-quality enterprises" with "temporary difficulties" to pay down debt by giving their bankers equity in their enterprises.