China's economy grows 4.5% in third quarter, slightly above forecasts

China's economy grew 4.5% in July–September from a year earlier, the National Bureau of Statistics (NBS) said in Beijing on Monday, October 19, according to Xinhua and the German agency DPA. The figure was a little above the 4.4% that economists polled by Reuters and Bloomberg had expected, SBS News and the Seoul Economic Daily reported. Growth for the first nine months was 4.6%, inside the government's full-year target of 4.5% to 5%.

The headline numbers

Growth picked up from 4.3% in the second quarter, which SBS News and the Seoul Economic Daily described as the slowest pace since the last quarter of 2022. First-quarter growth was 5.0%. All the reports give year-on-year rates; none of those read gives a quarter-on-quarter figure.

According to Xinhua, output in January–September came to about 107.11 trillion yuan (about $15.94 trillion). NBS deputy head Mao Shengyong told reporters the nine-month increase of 5.7 trillion yuan was the largest for the period in five years, and that third-quarter growth rose while major economies were expected to slow.

DPA reported that Mao expressed confidence that the annual target would be met. He attributed the second-quarter slowdown to oil price developments linked to the Middle East and said he expected improvement in the fourth quarter.

Industry, trade and the consumer

September data released alongside the GDP figure were mixed:

• Industrial output at larger firms rose 5.5% year on year in September, up from 5.2% in August and in line with the Reuters forecast, SBS News reported. Over nine months, Xinhua said, industrial value-added rose 5.3%, with high-tech manufacturing up 14.3%.
• Retail sales rose 1.1% in September, against a Reuters forecast of 0.6% and 0.4% in August, the fastest since March, according to SBS News. DPA noted that consumer spending nonetheless remains weak.
• Exports rose 21.3% in dollar terms over January–September and 36.3% in September alone, DPA reported, citing strong global demand for semiconductors and AI-related electronics. The nine-month goods trade surplus was about $938 billion; SBS News and the Seoul Economic Daily said some forecasts expect it to pass $1 trillion with October data, against $1.1889 trillion for all of 2025.
• Unemployment in cities was 5.2% in September, down 0.1 point from August, according to Xinhua.

Investment and property

Fixed-asset investment fell 7.2% in the first nine months, the same decline as through August, and investment in property development fell 20.6%, according to SBS News and DPA. Excluding property, investment was down 4.2%, SBS News reported. DPA said falling home prices are weighing on consumer confidence and local government land-sale revenue, and that since October authorities have offered state-backed interest subsidies on some new loans to first-time buyers.

SBS News also reported that crude oil refining fell 8.4% in the period, which it linked to the war involving Iran.

How it was read

The NBS said in its statement that the economy had pushed ahead under pressure, Xinhua reported. SBS News reported that the bureau also acknowledged that domestic demand remained insufficient and called for macro policies to expand it.

Some analysts said growth within the target range means authorities face less pressure for aggressive stimulus in the fourth quarter, according to SBS News and the Seoul Economic Daily. ANZ chief economist Raymond Yeung kept his 2026 forecast at 4.6%, while pointing to weak domestic demand, deflation and the property slump as risks, SBS News reported.

DPA noted that the International Monetary Fund recently trimmed its China forecast to 4.5% for 2026 and 4% for 2027, warning that weak domestic demand remains a major risk. The large trade surplus is a source of friction with trading partners, particularly in Europe, DPA and the Seoul Economic Daily reported.