China's economy grows at slowest pace in a year amid US trade war

By&nbspAP pinch Euronews

Published on 20/10/2025 - 11:10 GMT+2

China’s system expanded astatine 4.8% successful nan July-September quarter, nan slowest yearly gait successful a year, weighed down by waste and acquisition tensions pinch nan United States and slack home demand.

The July-September information was nan weakest gait of maturation since nan 3rd 4th of 2024, and compares pinch a 5.2% gait of maturation successful nan erstwhile quarter, nan authorities said successful a study connected Monday. In January-September, nan world’s 2nd largest system grew astatine a 5.2% yearly pace.

Despite US President Donald Trump’s higher tariffs connected imports from China, its exports person remained comparatively beardown arsenic companies person expanded income to different world markets.

China’s exports to nan United States fell 27% successful September from nan twelvemonth before, moreover though maturation successful its world exports deed a six-month high, climbing 8.3%.

Exports of electrical vehicles doubled successful September from a twelvemonth earlier, while home rider car income climbed 11.2% year-on-year past month, down from a 15% emergence successful August, according to information released past week.

Tensions betwixt Beijing and Washington stay elevated, and it’s unclear if Trump and Chinese leader Xi Jinping will spell up pinch a projected gathering during a location acme astatine nan extremity of this month.

Xi and different ruling Communist Party members are convening 1 of China’s astir important governmental meetings for nan twelvemonth connected Monday, wherever they will representation retired economical and societal argumentation goals for nan state for nan adjacent 5 years.

Property assemblage downturn

The system slowed successful nan past 4th arsenic nan authorities moved to curb fierce value wars successful sectors specified arsenic nan car manufacture owed to excess capacity.

China is besides facing challenges including a prolonged spot assemblage downturn which has been affecting depletion and demand.

Data released connected Monday showed China’s residential spot income fell 7.6% by worth successful nan January-September play from a twelvemonth earlier. Industrial output roseate 6.5% year-on-year past month, nan fastest gait since June, but unit income maturation slowed to 3% from nan twelvemonth before.

Ratings agency S&P estimates nationwide caller location income will autumn by 8% successful 2025 from nan twelvemonth earlier and by 6% to 7% successful 2026.

The World Bank expects China’s system to turn astatine a 4.8% yearly complaint this year. The government’s charismatic maturation target is astir 5%.

Lacklustre spending successful Golden Week

Chinese shares roseate connected Monday, pinch nan Hang Seng successful Hong Kong climbing 2.42% and nan Shanghai Composite scale up 0.63%.

A National Bureau of Statistics spokesperson said China has a “solid foundation” to execute its full-year maturation target, but cited outer complications — including waste and acquisition clash pinch nan US and different trading partners and protectionist policies successful galore countries — arsenic reasons for nan slowdown.

China’s stronger economical maturation successful nan first half of this twelvemonth gives it “some buffer” to execute nan maturation target, said Lynn Song, main economist for Greater China astatine ING Bank.

However, spending during China’s eight-day Golden Week nationalist vacation successful October was “mildly disappointing”, reflecting sluggish user assurance and demand, Morningstar analysts said successful a statement this month.

China's liking complaint trajectory

Investments successful factories, instrumentality and different “fixed assets” fell 0.5% successful nan past quarter, underscoring weakness successful home demand. It besides was reflected successful prices, which person continued to autumn some astatine nan user and nan wholesale level.

There’s room for nan authorities to do more, Song said. “(We) are looking to spot if location will beryllium further measures to support depletion and nan spot market, arsenic nan effect from erstwhile policies originates to weaken,” he added.

Economists are besides expecting a complaint trim by China’s cardinal slope by nan extremity of nan year, which could promote much spending and investment.

China’s system is besides apt to further slow successful 2026, said Jacqueline Rong, main China economist astatine BNP Paribas. She noted that spot finance successful nan state looks for illustration it will proceed to fall, while nan AI boom, which helped assistance China’s system and substance a banal marketplace rally, is expected to moderate.