China’s economic growth slowed more than expected to the weakest pace since the first quarter of 2009 as the country’s trade war with the U.S. puts pressure on growth, according to official data released on Friday.
The world’s second-largest economy said its economy grew 6.5 percent year-over-year in the third quarter of 2018. That missed expectations for a 6.6 percent growth, according to analysts polled by Reuters. The latest GDP data also came in lower than the 6.7 percent year-over-year expansion in the previous quarter.
Despite the GDP miss, China’s stock markets recovered from earlier losses to trade in positive territories. The Shanghai composite was about 0.37 percent higher, and the Shenzhen composite inched up 0.325 percent.
On a quarter-on-quarter basis, China’s economy grew 1.6 percent, according to the National Bureau of Statistics. That met the estimates by economists in a Reuters poll.
Kelvin Tay, regional chief investment officer at UBS Global Wealth Management, said the slowdown in China’s growth is not surprising.
“China cannot be growing at 6.6-6.7 percent every quarter because of the fact that they’re starting to deleverage and also for the fact that you’ve got a trade dispute going on with the Americans,” he told CNBC’s “Street Signs” after the GDP data release.
In addition to the latest GDP figures, China also released a slew of other economic data:
- Industrial production for September grew 5.8 percent compared to a year ago, missing expectations of a 6 percent expansion by Reuters.
- Retail sales for September jumped 9.2 percent compared to the same month last year, beating Reuters’ estimates of a 9 percent increase.
- Fixed asset investment for January-to-September grew 5.4 percent year-over-year, beating Reuters’ forecast of a 5.3 percent growth.
Although Beijing’s official GDP figures are tracked as an indicator of the health of the world’s second-largest economy, many outside experts have long expressed skepticism about the veracity of China’s reports.