China’s economic growth slowed to 6% year-on-year in the third quarter, amid a trade war with the US and fading demand at home and abroad.
This means the world’s second-largest economy grew at its weakest pace in at least 27 years and at a rate below the 6.2% growth seen in the second quarter.
Mao Shengyong, spokesman for China’s National Bureau of Statistics, said: “Generally speaking, the national economy maintained overall stability in the first three quarters.
“However, we must be aware that given the complicated and severe economic conditions both at home and abroad, the slowing global economic growth, and increasing external instabilities and uncertainties, the economy is under mounting downward pressure.”
China is expected to record 6.2% growth over the year, according to a Reuters poll, down from last year’s 6.6%.
The trade war with the US has hit the Chinese economy, with China’s imports down in September for a fifth consecutive month and exports also down.
Although tensions have eased slightly with the announcement of the first phase of a deal a week ago and the suspension of a planned tariff hike, little has changed for now.
Chinese policymakers have been trying to boost growth with tax cuts, the easing of lending rules and funding infrastructure projects.
There are concerns that there are few options left in an economy already facing debt after previous easing.
Alicia Garcia Herrero, chief economist for Asia-Pacific at French investment bank Natixis in Beijing, said China has “limited room to push up growth”, despite the partial trade deal with the US.
She added: “In other words, we finally clearly see the impact of the trade war and lack of real response of the Chinese economy to stimulus.
“I think the number is worrisome for 2020 unless China takes some big action.
“The only immediate one for the manufacturing sector is a devaluation of the renminbi (the official currency of the People’s Republic of China). I think they are leaning towards this.”
Toru Nishihama, chief economist at Tokyo’s Dai-ichi Life Research Institute, said: “The Chinese authorities must be taking the economic situation quite seriously.
“The US-China trade war has worsened China’s jobs and wage situation and corporations also refrained from making capital investment.
“There is speculation in the markets that the central bank in China may expand monetary policy, but considering higher inflation it would be difficult for the central bank to do so.
“There is still a possibility that the trade friction between China and the United States would flare up again, which would put downward pressure on the Chinese economy.”
Asian markets were mostly down on news of the lower-than-expected GDP growth.
The Shanghai Composite index lost 0.7% and Seoul’s main KOSPI closed down 0.83%.
China is Australia’s top trading partner and the country’s S&P/ASX 200 index closed 0.5% lower.
Hong Kong’s Hang Seng lost 0.3% but Japan’s Nikkei 225 index was up 0.2%.