China's economy grew 7.9 percent from a year earlier during the April-June period, official data showed Thursday, but the pace of expansion slowed from the first quarter amid fears that the corporate sector may become sluggish ahead due largely to material inflation.

The world's second-biggest economy recorded the fifth straight quarter of growth, underscoring that the Asian power has steadily overcome the coronavirus shock, buoyed by the healthy recuperation of both internal and external demand.

Since the increase in new infections apparently peaked in late February last year, China, dubbed the "world's factory," has shown signs of a V-shaped economic recovery with business activities intensifying and retail sales bouncing back.

In the January-March period of 2021, the Chinese economy posted its steepest quarterly expansion on record, up 18.3 percent from the previous year. China was also the only major economy to achieve positive growth in 2020.

China's quarter-on-quarter gross domestic product expansion in the three months through June was 1.3 percent, according to the latest data.

The economic outlook, however, has become gloomy, given that lingering tensions with the United States over trade and human rights issues as well as spikes in global material prices are likely to take a toll on production and investment down the road, analysts say.

Beijing has still been at loggerheads with Washington over several matters including tariff barriers, its alleged human rights abuses, Taiwan and Hong Kong, weighing on China's trade to the United States, the world's largest market.

Earlier this week, the United States stepped up a warning for businesses with supply chain and investment links to China's far-western Xinjiang region, citing the risk of association with alleged severe human rights abuses and forced labor there.

Some other democratic nations also have started to levy sanctions or take similar measures against China, accusing the Communist-led government of committing "genocide" in Xinjiang. Such moves might drag down activities of Chinese companies.

Photos of Chinese President Xi Jinping are seen at the Museum of the Communist Party of China on June 25, 2021, in Beijing. (Kyodo) ==Kyodo

The leadership of President Xi Jinping has consistently argued that detention camps in Xinjiang are vocational training centers established to pre-emptively combat terrorism and religious extremism.

Meanwhile, sharp rises in material and commodity prices in the wake of a global economic rebound may make Chinese enterprises unwilling to boost investment and production.

Recent tightening of government regulations on the country's IT giants, aimed at curbing their monopolistic behavior and disorderly capital expansion, would impede innovation of the Chinese high-tech industry, which could also hamper economic growth.

So far, China's economy has been on a stable recovery path on the back of pump-priming policies such as providing ample funds to money markets.

In the first half of this year, retail sales of consumer goods surged 23.0 percent, while investment in fixed assets, excluding rural households, rose 12.6 percent.

China's industrial production gained 15.9 percent, with the total value of exports soaring 28.1 percent.

During the April-June period in 2020, the nation's economy grew only 3.2 percent after plunging 6.8 percent in the first three months of the year, when the virus, first detected in the central city of Wuhan, raged in China.

Following the spread of the virus, China drastically restricted the movements of its 1.4 billion population to prevent further infections, dealing a crushing blow to consumer spending, employment and trade across the board.

China's National Bureau of Statistics said that the country's economy in the first half year maintained growth momentum, but it expressed wariness about the prospects.

"The epidemic continues to mutate globally and external instabilities and uncertainties abound. At home, the economic recovery is unbalanced and more efforts are needed to consolidate the foundation for the steady recovery of the development," it said.

"We will keep the economy performing within an appropriate range, advance high quality development solidly and spare no efforts to fulfil the whole year targets and tasks for the economic and social development," the bureau added.

At this year's session of the National People's Congress in March, the nation's parliament, China set an annual GDP target of "over 6 percent" for 2021, marking such a goal for the first time in two years.