China’s economy grows at 7.8% in Q3

Beijing, Oct 19 – China's economy grew at its quickest pace this year between July and September in a rebound fuelled largely by investment, although signs are already emerging that the pick up in activity may lose some vigour.

Gross domestic product in the world's second-biggest economy rose 7.8% from a year earlier, official data showed, marking only the second quarter in the last 10 in which growth has accelerated. An unexpected fall in exports in September, and easing growth in factory output and retail sales suggested the economy was already slowing down at the end of the quarter.

Authorities are also expected to cool credit growth as inflation pushes to a seven-month high, another factor analysts say will drag on economic activity.

"The growth peak was behind us in the third quarter," said Ting Lu, an economist at Bank of America-Merrill Lynch. "We believe the People's Bank of China will slightly shift its monetary policy from a moderate expansion in the third quarter to a neutral stance."

After three decades of double-digit growth heavily reliant on exports and investment, China is trying to shift or "restructure" the economic mix.

 

Source: Reuters