China’s Economy Builds Post-Pandemic Momentum
November 16, 2020
China saw a broad economic recovery in October, continuing a rebound that is happening much faster than many economists had previously expected. Industrial production had previously led the nation’s rebound, but now consumer spending and investment are growing at a faster year-over-year pace.
Industrial output climbed 6.9% in October as compared to a year prior, beating predictions of a 6.5% increase. Fixed-asset investment was up 1.8%, and consumer spending, an area of relative weakness following the coronavirus outbreak, rose 4.3% year over year. That’s an acceleration from September’s 3.3% increased, but a bit shy of the 4.6% increase that economists had been expecting.
While economists do expect this acceleration in growth to continue throughout the fourth quarter, they do caution that there may be a ceiling. The threat of a resurgence of the virus will put downward pressure on domestic consumption, and industrial output remains limited by the state of the global economy. Still, analysts expect growth of about 5%-6% in the fourth quarter, bringing the full year’s expansion to roughly 2%.