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PREVIEW-China's battle against debt to slow Q2 GDP growth to 6.8 pct

* Open GDP poll cpurl://apps.cp./Apps/econ-polls?RIC=CNGDP%3DECI

* China economy seen growing 6.8 pct in Q2 y/y, vs Q1's 6.9 pct

* Steps to curb property, debt risks may weigh on growth

* Growth likely to cool steadily later this year -economists

* June factory, retail sales and investment seen largely steady

* Q2 GDP data, June activity data due July 17 at 0200 GMT

BEIJING, July 12 (Reuters) - China's economic growth is expected to have cooled to 6.8 percent in the second quarter as Beijing tightens the screws on financial risks, a Reuters poll showed, in a sign the world's second-biggest economy is set for a further slowdown over the coming quarters.

The survey of 60 economists suggested government efforts to flush out property speculators, defuse asset bubbles and reduce high levels of debt across the economy will continue to chip away at growth from the first quarter's robust pace of 6.9 percent.

While policymakers are treading cautiously ahead of a key party meeting later this year, analysts say that weaning China off its dependence on years of cheap money may pose a threat to the economy if not handled well - especially as rising borrowing costs risk depressing investment and confidence.

Just the same, the broad consensus is that the economy is entering a period of a gradual deceleration rather than a sharp downturn. And, solid exports could help cushion the impact from the deleveraging drive, economists said.

"The economy could slow due to combined effects of property controls and the develeraging push, but we don't expect a significant slowdown as exports improve," said Tang Jianwei, senior economist at Bank of Communications in Shanghai.

A surprisingly upbeat gross domestic product reading would likely lift stocks and global commodity prices, but a weak outcome could boost bearish bests on the yuan, which has gained about 2 percent against the dollar so far this year.

Economists in the poll estimated GDP grew 1.7 percent quarter-on-quarter, versus 1.3 percent in the first quarter, though only 17 analysts gave sequential forecasts.

The first-quarter growth of 6.9 percent was the fastest in six quarters, driven by strong government infrastructure spending and a gravity-defying property boom.

INVESTMENT RISK

In an environment of tightening financial conditions, economists say investment - a vital growth engine - may take a hit and put the brakes on growth.

Zhu Baoliang, chief economist at the State Information Centre, a government think-tank, told the official Financial News this week that he expected China's growth to slow to 6.6 percent in the third quarter and 6.4 percent in the fourth.

Still, Zhu tipped the economy to grow 6.7 percent this year, ahead of the government's target of around 6.5 percent.

Moody's Investors Service downgraded its credit rating in May, saying it expects the country's financial strength will erode in coming years as growth slows and debt continues to rise.

China will release second-quarter GDP on July 17, along with June industrial output, retail sales and fixed asset investment.

June trade figures will be issued on Thursday, with exports seen up 8.7 percent last month from a year earlier - matching that of May, according to a separate Reuters poll.

TIGHTENING CONDITIONS

The People's Bank of China (PBOC) shifted to a modest tightening bias at the start of this year, guiding market interest rates higher during the first quarter, including immediately after the U.S. Federal Reserve raised rates in March.

But the PBOC injected substantial liquidity last month to help avoid an end-quarter cash crunch as Beijing tightened regulations to force banks to delevergae.

Indeed, policy insiders expect the central bank to hold off on further tightening and could even slightly loosen its grip in the coming months to support growth.

"Weve pencilled in cooling growth in Chinese demand over the second half of the year," said Qu Hongbin, HSBC chief economist for China.

"Much depends, however, on how hard Chinas central bank will keep pressing the brakes: it seems unlikely itll want to derail growth entirely. (Additional reporting by Shaloo Shrivastava in Bengaluru; Editing by Shri Navaratnam)