China's economy grows 4.5% in third quarter, ahead of forecasts
China's economy expanded 4.5 per cent year on year in July–September, helped by exports and public spending, while investment and property remained weak.
The Global Sun Desk ·
China's economy grew 4.5 per cent year on year in the July–September quarter, the National Bureau of Statistics said on Monday, 19 October. The figure was a little above the 4.4 per cent that economists polled by Bloomberg had expected, and better than the 4.3 per cent recorded in the second quarter.
Output rose 1.2 per cent from the previous quarter, according to Italian business daily Il Sole 24 Ore. Across January to September the economy is up 4.6 per cent, which sits inside the government's target range of 4.5 to 5 per cent for 2026. Xinhua put total output for January to September at about 107.11 trillion yuan.
A mixed set of monthly numbers
The September data showed a recovery that is uneven across the economy:
- Industrial output rose 5.5 per cent from a year earlier, in line with expectations.
- Retail sales grew 1.1 per cent, up from 0.4 per cent in August. Leaving out car purchases, growth was 3.9 per cent, the fastest since October 2025.
- Fixed-asset investment was 7.2 per cent lower in the first nine months, the same pace of decline as through August.
- Real-estate investment fell 20.6 per cent over the same period, a deeper drop than the 19.9 per cent recorded through August.
- The unemployment rate was 5.2 per cent in September, down from 5.3 per cent in August.
Il Sole 24 Ore broke the nine-month growth down by sector: services were up 5.2 per cent, industry 3.8 per cent and agriculture 3.7 per cent.
Exports and government spending
The Free Press Journal said exports have been helped by AI investment around the world, while household spending and the property market remain weak. Bloomberg, it reported, quoted Xing Zhaopeng, senior China strategist at the Australia and New Zealand Banking Group, as linking part of the improvement in investment and consumption to higher government spending. He also cautioned that the recovery is exposed to fiscal uncertainty and to downside risks in 2027.
Financial markets reacted calmly. The yield on China's 10-year government bond edged up by one basis point to 1.65 per cent, while the offshore yuan strengthened by 0.1 per cent to 6.6829 per US dollar. The currency is more than 4 per cent stronger so far this year.
China is the world's second-largest economy, so its quarterly growth is watched closely by exporters and policymakers elsewhere, including in India. The next set of monthly figures from the statistics bureau will show whether the pick-up in consumer spending holds beyond September.