HONG KONG (AP) – China’s economy expanded at 4.8% from July to September, its slowest annual pace in a year, weighed down by trade tensions with the United States and weak domestic demand.
The government said in a report on Monday that the July-September period was the weakest pace of growth since the third quarter of 2024, compared with the previous quarter’s 5.2% growth pace.
From January to September, the world’s second-largest economy grew at an annualized pace of 5.2%. Despite US President Donald Trump increasing tariffs on imports from China. export It has remained relatively strong as companies expand sales to other global markets.
china export Although global export growth increased by 8.3%, reaching the highest level in six months, exports to the United States in September fell 27% from the previous year.
Exports of electric vehicles in September doubled compared to the previous year, but domestically passenger car sales Data released last week showed that prices rose 11.2% last month compared to the same month last year, slowing from a 15% rise in August.
Tensions between China and the United States remain high, and it is unclear whether President Trump and Chinese leader Xi Jinping will go ahead with their proposed meeting at a regional summit later this month.
Xi and other ruling Communist Party members convene one of China’s most important meetings political meeting On Monday, the council will summarize the year and set the country’s economic and social policy goals for the next five years.
The economy slowed last quarter as authorities moved to curb intense price competition in sectors such as the auto industry caused by overcapacity.
China is also facing challenges such as a prolonged period. Downturn in the real estate sector It is affecting consumption and demand.
According to data released on Monday, residential real estate sales in China fell 7.6% in value terms in the January-September period compared to the same period last year. Industrial production rose 6.5% last month from a year ago, the fastest pace since June, but retail sales growth slowed to 3% year-on-year.
Rating agency S&P predicts that new home sales nationwide will decline by 8% from the previous year in 2025, and by 6-7% in 2026.
The World Bank predicts that China’s economy will grow at an annual rate of 4.8% this year. The government’s official growth target is around 5%.
Chinese stocks rose on Monday, with Hong Kong’s Hang Seng Index up 2.3% and the Shanghai Composite Index up 0.5%.
A spokesperson for the National Bureau of Statistics said China had a “solid foundation” to meet its full-year growth target, but cited external complexities such as trade tensions with the United States and other trading partners and many countries’ protectionist policies as reasons for the slowdown.
Lin Song, chief economist for Greater China at ING Bank, said China’s strong economic growth in the first half of this year provides “some cushion” towards achieving growth targets.
However, Morningstar analysts said in a note this month that China’s spending during October’s eight-day Golden Week national holiday was “somewhat disappointing,” reflecting weak consumer confidence and demand.
Investment in factory, equipment and other “fixed assets” fell by 0.5% last quarter, underscoring weakness in domestic demand. This is reflected in prices, which continue to fall at both the consumer and wholesale level.
The government has room to do more, Song said.
“As the effectiveness of previous policies begins to wane, (we) are considering whether there are further measures to support consumption and the property market,” Song said.
Economists also expect the People’s Bank of China to cut interest rates by the end of the year, potentially spurring spending and investment.
Jacqueline Long, chief China economist at BNP Paribas, said China’s economy is likely to slow further in 2026, adding that the country’s real estate investment “is likely to continue to decline” and that the AI boom that has boosted China’s economy and fueled stock market gains is also expected to slow.
