China’s economy grew at its slowest pace in the third quarter, expanding by 4.6% annually according to the National Bureau of Statistics, falling below the government’s target of around 5%. Despite missing the mark, official figures like retail sales and factory output surpassed expectations. To counter this slowdown, Beijing has implemented various measures to stimulate growth.
Economists have differing views on the situation; the IMF’s Eswar Prasad believes the growth target is at risk, while Moody’s Analytics’ Harry Murphy Cruise is more optimistic, expecting the stimulus to meet the 5% target. However, challenges persist, with new home prices plummeting and the property market acting as a drag on growth, according to ING’s chief economist, Lynn Song.
China’s central bank has responded by urging financial institutions to increase lending, including significant cuts to interest and mortgage rates. The government has also introduced additional measures to bolster economic growth. Despite facing obstacles like the property crisis and low consumer and business confidence, China continues to adapt and strategize for a path towards resilience and recovery.
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