China's economy grew at its slowest pace in a year in the third quarter of 2021, with the global energy slowdown, supply chain bottlenecks and volatile property market also adding pressure. to policymakers to spur an economic recovery that is showing signs of slowing.
Data released earlier in the day showed GDP grew 0.2% quarter-on-quarter, compared with a 0.5% increase in forecasts released by Investing.com and 1.3% growth the previous month. . GDP grew 4.9% year-on-year, lower than Investing.com's 5.2% growth and 7.9% growth recorded in August 2021.
The ongoing China Evergrande (HK:3333) Group (HK: {50017 | 3333}}) debt crisis, supply chain delays and emerging energy crisis are major challenges facing China. overcome.
"The domestic economic recovery remains unstable and uneven," National Bureau of Statistics (NBS) spokesman Fu Linghui said at a news conference on Monday.
The slow growth rate contrasts with the country's impressive economic recovery from COVID-19 in 2020, fueled by effective virus containment and overseas demand for manufactured goods. of China is increasing.
"Given the less-than-positive growth numbers we expect in the coming months, we think policymakers will take more steps to boost growth, including ensuring ample liquidity." in the interbank market, accelerating infrastructure development and easing some aspects of overall real estate and credit policy," said Oxford Economics chief Asia economist Louis Kuijs. with Reuters.
Developer China Evergrande Group's debt concerns and worries about potential credit risk from China's property sector spilling over into the broader economy also continue to mount.
Meanwhile, industrial output rose 3.1% year-on-year in September, lower than the 4.5% increase in Investing.com forecast and the 5.3% increase in the previous month.
Retail sales rose 4.4% year-on-year in September, higher than Investing.com's 3.3% forecast and the previous month's 2.5% growth. The unemployment rate was 4.9%, lower than the 5.1% recorded in August.
The industrial sector has been hit by the energy crisis, with coal shortages continuing. The industry is also heavily impacted by the environmental impacts of heavy pollutants such as steel mills and floods during the summer.
"Most of the negative factors are policy driven ... the economy is having a lot of problems and these problems are not going to go away anytime soon because the policies are still there and so it will continue. until 2022," ING chief economist for China, Iris Pang, told Reuters.
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