Mubasher: Car sales in China dipped in July for the second month in a row, driven by weaker economic outlook and controls on the vehicle imports from the US.

The number of sold passenger vehicles in the world’s largest auto market, fell to 5.4% to 1.6 million units in July, leading the sales growth for this year to a drop of 2%, the China Passenger Car Association said on Thursday.

External drivers for the dropping sales included the escalating tension between Washington and Beijing which led consumer sentiment in recent months to decline, according to the association.

However, the number of sold cars from Japanese, South Korean and domestic auto manufacturers grew last month, as large brands like Geely and Toyota posted sales growth of 32% and 17% respectively.

China’s economy has seen recently a touch of slowdown, with a weakening yuan and a drop in stock market.

This came after the world’s second largest economy imposed in July an additional 25% tariff on US imports, including vehicles and major products like soybeans.