China’s economy grew at its slowest pace in a year in the third quarter, hurt by power shortages, supply bottlenecks and sporadic COVID-19 outbreaks.
The slowing economy raised pressure on politicians amid rising jitters over the country’s beleaguered property sector.
Data released on Monday showed gross domestic product (GDP) grew 4.9 per cent in July-September from a earlier, the weakest pace since the third quarter of 2020 and slowing from 7.9 per cent in the second quarter.
That marked a further deceleration from the 18.3 per cent expansion in the first quarter, when the year-on-year growth rate was heavily flattered by the very low comparison seen during the COVID-induced slump of early 2020.
“The domestic economic recovery is still unstable and uneven,” said National Bureau of Statistics spokesperson Fu Linghui at a briefing in Beijing on Monday.
On a quarterly basis, growth eased to 0.2 per cent in July-September from a downwardly revised 1.2 per cent in the second quarter, the data showed.
The world’s second-largest economy has rebounded from the pandemic but the recovery is losing steam, weighed by faltering factory activity, persistently soft consumption and a slowing property sector as policy curbs bite.
“In response to the ugly growth numbers we expect in coming months, we think policymakers will take more steps to shore up growth, including ensuring ample liquidity in the interbank market, accelerating infrastructure development and relaxing some aspects of overall credit and real estate policies,” said Louis Kuijs, head of Asia economics at Oxford Economics.
Global worries about a possible leaking of credit risk from China’s property sector into the broader economy have also intensified as major developer Evergrande wrestles with more than $US300 billion ($A404 billion) of debt.
Chinese leaders, fearful that a persistent property bubble could undermine the country’s long-term ascent, are likely to maintain tough curbs on the sector even as the economy slows, but could soften some tactics as needed, policy sources and analysts said.
Premier Li Keqiang said on Thursday China has ample tools to cope with economic challenges despite slowing growth, and the government is confident of achieving full-year development goals.
China’s economy is expected to grow 8 per cent this year, central bank governor Yi Gang said on Sunday.
Analysts polled by Reuters expected the People’s Bank of China to keep banks’ reserve requirement ratio unchanged in the fourth quarter, before delivering another 50-basis points cut in the first quarter of 2022.
September industrial output rose 3.1 per cent from a year earlier, missing expectations and down from August’s 5.3 per cent and marking the slowest growth since March 2020, during the first wave of the pandemic.
But consumption showed signs of an improvement, with retail sales growing 4.4 per cent in September, faster than the 2.5 per cent in August.