China’s economic growth slows as trade tensions with US flare up

China’s financial development slowed within the three months to the tip of September as issues within the property market endured and commerce tensions with the US flared up.

The world’s second-largest economic system grew by 4.8% in comparison with the identical interval in 2024, its weakest tempo in a yr, official figures launched on Monday present.

The information comes after China imposed sweeping controls on its exports of rare earths – minerals important for the worldwide manufacturing of electronics – a transfer that rocked its fragile commerce truce with the US.

The third-quarter development figures will set the tone for a gathering of China’s high leaders this week to discuss the country’s economic blueprint over the following 5 years.

The most recent development determine marked a slowdown from the annual fee of 5.2% seen within the three months to July.

China’s Nationwide Bureau of Statistics mentioned the economic system confirmed “robust resilience and vitality” towards strain . It credited momentum in its expertise sector and enterprise providers as key development drivers.

Beijing has set a aim of “round 5%” financial development this yr and has to this point averted a pointy downturn, helped by authorities help measures and what – till just lately – had been a commerce ceasefire with Washington.

When China introduced controls on uncommon earths earlier this month, US President Donald Trump responded swiftly by threatening an additional 100% tariffs on imports from China.

US Treasury Secretary Scott Bessent has mentioned he expects to fulfill Chinese language officers this week in Malaysia in an try and ease tensions and arrange a gathering between Trump and his counterpart Xi Jinping.

Earlier than the latest flare-up, Chinese language companies had taken benefit of the commerce truce with Washington to ship items to the US, leading to China’s exports rising by 8.4% in September. The overall worth of imports to China was additionally up.

China’s industrial output grew by 6.5% final month from a yr earlier, with its 3D-printing, robotics and electrical autos producers amongst its strongest performers.

Its service sector, which incorporates IT help, consultancies, and transport and logistics corporations, additionally grew.

The most recent knowledge exhibits that China’s exports have helped to offset its “sluggish” home spending, in response to Sheana Yue, senior economist at Oxford Economics.

Beijing has spent billions on incentives reminiscent of subsidies, greater wages and reductions to encourage locals to spend extra and raise its economic system.

Nonetheless, Ms Yue mentioned it was unlikely China’s financial development this yr would exceed 4.8% with out additional authorities help, which may include the brand new 5-Yr Plan laying out Beijing’s financial targets.

China’s property sector also continued to struggle as actual property funding fell 13.9% within the yr as much as September.

The housing market goes via a pointy downturn, marked by falling residence costs, shrinking gross sales and cases of builders abandoning their tasks.

The actual property sector accounts for a few third of the Chinese language economic system and has been a significant supply of revenue for native governments.

House costs have fallen in nearly each main metropolis regardless of authorities help measures, mentioned economics lecturer Laura Wu from Nanyang Technological College.

Within the long-run, housing “remains to be the key drag on China’s financial development” even because it faces uncertainty from Washington’s tariffs and different commerce limitations, mentioned Prof Wu.