China Gdp Growth Slowed

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China Gdp Growth Slowed

China'S Gdp Growth Slowed In Q3

Weak domestic demand has slowed down the growth rate of China's GDP in Q3. The growth rate was only 4.8% y/y, which is still below the 5% target set by the officials.

The growth was mainly driven by a jump in exports. In addition, a decline was seen in fixed investments as well as the household consumption. Overall, the GDP situation was very mixed and also highlighted the global fears about geopolitics and all the other stuff.

Household Consumption Declined

According to Commerzbank, the GDP expanded during the 3rd quarter and was also above expectations. But, it is hiding a weakness in the China's local demand.

During the first 3 quarters, a 5.2% growth was seen in the economy, which declined to 4.8% in Q3. But still, the Chinese economy is close to achieving the target of 5%.

But the data also showed a decline in fixed investments, which is an alarming situation for China. There's a good chance that it also has to do with the heavy US tariffs on China.

At the same time, household consumption didn't show a strong growth, which is also alarming. It could be due to higher inflation, low income, or a number of other reasons.

If we look at it from nominal terms, the GDP growth rate was around 3.7% y/y. Once again, that's way lower than the numbers reported by the China.

This marks the 10th quarter in a row in which the China has experienced deflation. According to Commerzbank, this also shows that China's economy is now facing involution.

But, we must also understand that China has managed to sustain a very high growth rate. For an economy as big as China, it is just not possible to sustain higher growth rates for much longer.

However, the economy is still on track to reach the 5% growth rate set by the Chinese central bank and the officials.

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