China's economic growth rate is decelerating, and many officials and analysts believe the moderation is healthy and will not lead to a hard landing.

Gross domestic product (GDP) rose by 9.5 percent year-on-year in the second quarter of 2011, tapering off slightly from the 9.7-percent growth posted in the first quarter and 9.8 percent in the fourth quarter of last year, the National Bureau of Statistics (NBS) said Wednesday.

On a quarterly basis, GDP increased 2.2 percent in the second quarter, accelerating from the first quarter's 2.1-percent expansion.

According to preliminary statistics, the country's GDP reached 20.45 trillion yuan (3.15 trillion U.S. dollars) in the first six months, up 9.6 percent year-on-year, NBS spokesman Sheng Laiyun told a press conference.

Sheng called the growth deceleration a desired outcome of macro regulation, which was also "normal" after the ending of some stimulus policies.

"The country's economic development is now shifting to self-initiated growth from previous overheated expansion spurred by the economic stimulus," he said.

Although some economic indicators declined, he noted the country's economic performance was "generally good" and had developed according to macro-economic regulation in the first half.

"The momentum of China's economic growth remains strong and the risk of a sharp growth plunge is slim," he said.

On an annual basis, both retail sales and industrial production registered double-digit increases in the first half and in June alone. Fixed assets investment surged 25.6 percent year-on-year from January to June.

According to NBS data, consumer spending contributed 4.6 percentage points to the country's GDP growth in the first half, investments made up 5.1 percentage points while foreign trade deducted 0.1 percentage point.

Consumer price index (CPI), the main gauge of China's inflation, rose 5.4 percent year-on-year in the first half, accelerating from 5 percent in the first quarter and above the government's target ceiling of 4 percent for this year.

At the beginning of the year, the Chinese government made ensuring price stability a top priority for 2011 and announced an array of targeted policies.

To soak up liquidity, China's central bank has raised the benchmark interest rate three times this year and hiked the reserve requirement ratio for banks six times.

Concern has been rising that the continuous tightening policies will hurt the world's second largest economy as the country's medium and small-sized companies, which typically have limited access to financing, feel the pinch.

Sheng said the interest rate increases will affect China's economy in the near term, but in the long run the rises will boost its sustainable development.

"The biggest challenge for the second half of the year remains how to strike a balance between the tasks of maintaining stable growth, regulating inflation expectations and restructuring the economy," Sheng said.

The country will maintain its macroeconomic policy stance and continue to prioritize price stability during the rest of the year, he said.

Sheng's remarks echoed a statement made by Premier Wen Jiabao. "Stabilizing prices remains the top priority for the country's macro-regulatory policies," Wen said, noting that the policies needed to be more flexible and forward-looking.

Wen said the prudent monetary policy should be kept in place but urged financial institutions to improve their credit structure and increase financial support to small businesses.

With the inflation rate remaining stubbornly high and an economic growth plunge unlikely, "we believe there will be no let-up in the monetary policy during the second half of the year and another interest rate increase is possible in the coming months," said Peng Wensheng, analyst with China International Capital Corp.

Liu Ligang, chief China economist for the Australia and New Zealand Banking Group, said he expected fast growth and high inflation to continue in the coming years in China.

Liu forecast China's GDP will grow by 9.4-9.6 percent year-on-year in the third quarter of this year, and ease to 9.2-9.4 percent in the fourth quarter because of a high comparison base from the same period of last year.

China's stock markets reacted positively to the figures released Wednesday. The benchmark Shanghai Composite

Index rose 1.48 percent to finish at 2,795.48. The Shenzhen Component Index also rallied, rising 1.72 percent to close at 12,479.15.