‘China Q3 growth has slowed amid trade spat’

BEIJING: China’s growth downshifted in the third quarter as investment slowed and the widening trade conflict with the United States weighed on sentiment, according to analysts.

The world’s second largest economy expanded by 6.5 per cent in the July to September period, the poll of 12 economists found ahead of the official release of gross domestic product figures tomorrow.

The sluggish growth would mark China’s slowest pace of expansion since the first quarter of 2009, when the financial crisis battered global markets and knocked China’s export machine.

The trade row with the US comes at a tough time for China’s economy, which has been hit by the government’s efforts to tackle a mountain of debt, with credit for local governments and stateowned enterprises tightening and infrastructure investment declining.

The third quarter forecast is down from 6.8 and 6.7 per cent in the first and second quarters, respectively. Policymakers have set a growth target of roughly 6.5 per cent for the year, down from 6.9 per cent last year.

The slowdown could be from a combination of the trade war and deleveraging, said Betty Wang, China economist at ANZ.

The key Shanghai Composite Index has fallen 22 per cent this year amid the turbulence, while the yuan has fallen about nine per cent against the US dollar.