China's economy grew by 4.5 percent in the third quarter

China's economy grew by 4.5 percent year-on-year in the third quarter, as strong external demand for technology products largely offset the impacts of a deepening real estate crisis and weak consumer demand. The growth beat economists' expectations of 4.4 percent and also rose above the three-year low of 4.3 percent recorded in the second quarter.

Tianchen Xu, Senior Economist at the Economist Intelligence Unit, stated that the recovery in September compensated for the weak performance in July and August. Xu noted that the increase in public investments, the strong course of the foreign trade sector, and the low base effect played a role in the improvement. China's monthly trade surplus reached a record level of $133.5 billion in September. Expecting these three factors to continue supporting growth in the fourth quarter, Xu forecast that China's economy would grow by 4.7 percent for the full year.

The data showed that while household and private sector investments remained weak, the economy continued to rely on production and exports. Growing by an average of 4.6 percent in the first nine months of the year, China's economy exhibited a performance generally in line with Beijing's official growth target of 4.5 to 5 percent. In September, retail sales increased by 1.1 percent year-on-year, exceeding analysts' expectations of 0.6 percent. Industrial production rose by 5.5 percent, coming in parallel with expectations. The urban unemployment rate stood at 5.2 percent in September.

While weakness in investments persisted, urban fixed asset investments fell by 7.2 percent in the first nine months of the year compared to the same period of last year. A Reuters poll had expected the decline to be 7.3 percent. The contraction in real estate development investments also deepened; these investments fell by 20.6 percent year-on-year in the January-September period, compared to a 19.9 percent decline in the first eight months.