Surprise growth in China's economy in the third quarter: Forecasts exceeded

In the third quarter of 2026, China's economy grew by 4.5 percent on an annual basis, exceeding the market expectation of 4.4 percent and regaining momentum following the slowdown in the second quarter.

According to data released by the National Bureau of Statistics of China, the economy, which recorded a growth of 4.3 percent in the second quarter, showed a recovery in the third quarter. On a quarterly basis, the growth rate rose from 1.2 percent compared to 0.9 percent in the previous period. In the first nine months of the year, a growth of 4.6 percent was achieved compared to the same period of last year, thus keeping the country within the government's annual growth target range of 4.5 to 5 percent.

The government's economic stimulus policies and strong export trends played an influential role in this recovery in growth. While external demand for artificial intelligence components, high-tech industrial products, and electric vehicles supported economic activity, industrial production and retail sales recorded their fastest increase in the last six months in September. Despite this, weak domestic demand and uncertainties in international markets were cited as risks ahead of the recovery.

According to sectoral data, annual growth rates as of June 2026 were 10.7 percent in information technology and software services, 6.9 percent in the financial sector, and 5.1 percent in transportation and storage. While accommodation and food services grew by 5 percent, the agricultural sector by 3.9 percent, and the construction sector by 4.1 percent, real estate activities contracted by 0.2 percent.