China’s economy on way up

BEIJING: China’s economic recovery accelerated in the third quarter as consumers shook off their coronavirus caution, although the weakerthanexpected headline growth suggested persistent risks for one of the few drivers of global demand.

Gross domestic product (GDP) grew 4.9% in JulySeptember from a year earlier, official data showed, slower than the 5.2% forecast by analysts in a Reuters poll but faster than the second quarter’s 3.2% growth.

‘‘China’s economy remains on the recovery path, driven by a rebound in exports.

‘‘Consumer spending is also headed in the right direction, but we cannot say it has completely shaken off the drag caused by the coronavirus,’’ Yoshikiyo Shimamine, chief economist at Daiichi Life Research Institute in Tokyo, said.

‘‘There is a risk that the return of lockdowns in Europe and another wave of infections in the United States will hurt consumer spending and trigger more job losses, which would be a negative for China’s economy.’’

The world’s secondlargest economy grew 0.7% in the first nine months from a year earlier, the National Bureau of Statistics (NBS) said.

Policymakers globally are pinning their hopes on a robust recovery in China to help restart demand as economies struggle with heavy lockdowns and a second wave of coronavirus infections.

China has partially emerged from a record slump caused by coronavirus shutdowns in the first months of the year.

NBS spokeswoman Liu Aihua warned that growth remained patchy.

‘‘Internally, the economy is still in the process of recovery,’’ she told a briefing in Beijing.

‘‘Some or most of the indicators have not returned to the normal growth level, and some of the cumulative growth rate has also declined.’’

On a quarteronquarter basis, GDP rose 2.7% in the third quarter, the NBS said, compared with expectations for a 3.2% rise and an 11.5% rise in the previous quarter.

Analysts were encouraged by a broader upturn in consumption and continued factory strength.

Retail sales grew 3.3% in September from a year earlier, speeding up from a modest 0.5% rise in August and posting the fastest growth since December 2019. Industrial output grew 6.9% after a 5.6% rise in August, showing the factory sector’s recovery was gaining momentum.

Fixedasset investment rose 0.8% in the first nine months from a year earlier, returning to yeartodate growth for the first time this year.

In the property sector, investment rose 12% in September from a year earlier, the fastest pace in nearly 18 months, providing a key support for broader investment.

The Government has rolled out a raft of measures including more fiscal spending, tax relief and cuts in lending rates and banks’ reserve requirements to revive the coronavirushit economy and support employment.

While the central bank stepped up policy support after widespread travel restrictions choked economic activity, it has more recently held off on further easing.

The International Monetary Fund has forecast an expansion of 1.9% for China for 2020, which is close to the central bank’s own projection of 2%.

That would make China the only major economy expected to report growth in 2020.

In the travel sector, domestic passenger flights in September beat their Covid19 levels, a sign that segment of the market is approaching a full recovery, even as most international borders remain shut. — Reuters