China's growth rises to 4.9% on higher consumer spending and trade

Marco Green
October 19, 2020

The mixed performance matched the mixed data: the USA government reported that retail sales rose in September for the fifth straight month, while the Federal Reserve said US industrial production had its weakest showing since the spring. "What's more, the monthly data show that growth was still accelerating heading into [the fourth quarter]", Julian Evans-Pritchard, senior China economist at research firm Capital Economics, said in a note sent to Al Jazeera.

However, the expansion fell short of forecasts and officials warned of uncertainty as the disease continues to ravage other key markets, with the National Bureau of Statistics saying "the global environment is still complicated".

China's economy grew 4.9 per cent on-year in the third quarter, sustaining its rebound from bruising virus lockdowns and moving closer to pre-pandemic levels, official data showed Monday.

She highlighted "great pressure" in forestalling virus cases from overseas and preventing a virus resurgence at home.

AUD/JPY continues to trade in green even though the data released soon before press time showed China's economy expanded less-than-expected in the third quarter. After contracting 6.8% in the first quarter of this year the economy grew 3.2% in the April-June quarter.

Authorities have lifted curbs on travel and business but visitors to government and other public buildings still are checked for the virus's telltale fever.

Travellers arriving from overseas must be quarantined for two weeks. That broke a streak of nearly two months with no virus transmissions reported within China.

The above-forecast Chin Industrial Production and risk-on support the AUD. They are taking market share from foreign competitors that still are hampered by anti-virus controls. Online commerce rose 15.3%. Ford Motor Co's China vehicle sales jumped 25 percent in the September quarter from a year earlier.

But "China is not absolutely free from the risk of a second wave of Covid-19, pent-up demand will likely lose some steam... and rising US-China tensions could dent China's exports and manufacturing investment", Lu said.

China has reported 4,634 coronavirus deaths and 85,685 confirmed cases, plus three suspected cases.

China's economy has grown 4.9 percent in the last quarter from a year ago proving the country is back to its pre-pandemic trajectory with consumer spending and industrial production going back to normal levels. Those temporarily cut off most access to cities with a total of 60 million people.

The growth was slower than the 5.2 per cent forecast by analysts in a Reuters poll, and followed 3.2 per cent growth in the second quarter.

Private sector analysts say as much as 30% of China's urban workforce, or up to 130 million people, may have lost their jobs at least temporarily.

The ruling party promised in May to spend $280 billion on meeting goals including creating 9 million new jobs.

But it has avoided joining the United States and Japan in rolling out extensive stimulus packages due to concern about adding to already high Chinese debt.

Other reports by Click Lancashire

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