China’s economy plows on as world’s only major growth engine

BEIJING - China’s recovery from the coronavirus pandemic continued in the third quarter and showed signs of broadening in September as consumer spending accelerated, keeping the economy on track to be the world’s only major one to grow this year.

Gross domestic product expanded 4.9 percent in the third quarter from a year ago, missing economists’ forecast for a 5.5 percent expansion. Both retail sales and industrial production gained momentum in September, reassuring markets that the recovery is on track.

The numbers show

China’s early and aggressive containment of the coronavirus has set the economy up for a faster rebound than any of its peers.

That’s a rare positive for a world economy still clawing its way out of its worst slump since the Great Depression - a revival further complicated by the resurgent virus in Europe and the US.

“It’s an encouraging and hopeful message for the rest of the world,” said Rob Subbaraman, global head of macro research at Nomura Holdings Inc. in Singapore. “If you successfully handle the health crisis, your economy can recover.”

Retail sales expanded

3.3 percent in September from a year earlier, industrial production grew 6.9 percent and investment growth accelerated to 0.8 percent in the nine months to the end of the quarter. Strong import growth in the third quarter may have dented the GDP number, even though it’s broadly seen as a bullish sign for demand.

Output expanded 0.7 percent in the year to date, meaning that the world’s second-largest economy has now regained all the ground it lost in the early months of the year. Markets were mixed on the news. The CSI 300 Index of stocks, which last week was within one percent of a five-year high, slipped

0.3 percent as of the mid-day break in Shanghai. The yuan was little changed near 6.7 per dollar, after briefly trading at its strongest in 18 months. – BLOOMBERG NEWS.