China’s economic recovery gathered pace in the third quarter of 2020, with GDP growth in July-September registering at 4.9 percent from a year earlier, boosted by investment and exports, official data showed Monday.
The growth beat the second quarter’s 3.2 percent, which reversed the first contraction on record at 6.8 percent in the first quarter. In the first half year, the economy declined by 1.6 percent, but it rebounded to a 0.7-percent rise in the first three quarters.
“The Q3 GDP growth accelerated from the first half, driven by infrastructure and real estate investment as well as a strong performance in export,” Wang Dan, chief economist with Hang Seng Bank China told CGTN.
The reading was slower than the median 5.2-percent forecast by AFP’s survey and Reuters’ poll, and missed expectation of 5.3-percent growth by Bloomberg.
“In our view, the number missed the consensus forecast, partly because high volatility made forecasting difficult,” Nomura’s Chief China Economist Lu Ting said in an email to CGTN. He emphasized missing forecast does not mean China’s economic recovery is hindered.
Lu said, “China’s quick recovery was a product of its stringent lockdowns, massive testing, population tracking, a large economy that can afford to be somewhat insulated, and fiscal stimulus via credit expansion.”
“Strong export growth, a further recovery from the pandemic, the lagged impact of fiscal stimulus and credit growth and pent-up demand following the summer floods all contributed to the robust activity data in September,” Lu further explained.
ICBC International said behind the positive economic growth is the rebound in investment and consumption, as both of the fixed asset investment in the first three quarters and retail sales in the third quarter turned positive for the first time this year.
The breakdown shows that growth in retail sales and revenue from catering services improved in September to 4.1 percent and -2.9 percent respectively year-on-year, from 1.5 percent and -7 percent in August, according to Nomura.
Sales growth of oil and oil products rose to -11.8 percent year-on-year in September from -14.5 percent in August, thanks to the gradual relaxation of social distancing rules that have supported the recovery in transportation and tourism industries, despite a fall in global oil price inflation, Nomura said.
Nomura expected retail sales growth to gradually recover further in coming months barring a second wave of COVID-19 in China. Read from source….