China's economic growth picks up as exports boom, consumers balk
SPY•China's economy grew 4.5% in the third quarter, beating forecasts of 4.4%, as exports and industrial output offset weak consumer spending. September retail sales rose 1.1%, while industrial output increased 5.5%.
1. Growth driven by exports
China's economy grew 4.5% in the third quarter, rebounding from three-year lows and exceeding the 4.4% forecast. Exports and industrial output drove growth, with industrial output rising 5.5% in September.
2. Consumers remain cautious
Retail sales rose 1.1% in September, their quickest growth in six months, but again lagged industrial output. The property downturn, weak household demand and price competition have weighed on businesses and workers.
3. Risks and policy support
China is on track to exceed last year's $1.2 trillion trade surplus, while the European Union is considering further curbs after agreeing with China to limit hybrid car exports to the bloc. Analysts warned that trade tensions and reliance on exports pose risks, while recent government measures include cheaper credit, mortgage subsidies and additional funding for local governments.
