China Q3 GDP Grows 4.5% Year on Year, Beating Forecasts on Strong Retail Sales and Industrial Output

China's economy expanded 4.5% year on year in the third quarter of 2026, topping the consensus forecast of 4.4% and accelerating from the 4.3% growth recorded in the prior quarter. On a seasonally adjusted quarterly basis, GDP rose 1.2%, well ahead of the 0.9% forecast and matching the previous quarter's pace. The year-to-date GDP figure through September came in at 4.6%, in line with estimates though slightly below the prior 4.7% reading.

Retail sales were the standout beat, surging 1.1% year on year in September against a forecast of just 0.5% to 0.6% and a prior reading of 0.4%, signaling a meaningful pickup in consumer spending. Industrial production rose 5.5% year on year, matching estimates and accelerating from 5.2% in August. The surveyed urban unemployment rate eased to 5.2% in September, better than both the 5.3% forecast and the prior reading.

The property sector remained under pressure. Property investment fell 20.6% year to date through September, worse than the 19.9% pace in the prior period, while residential property sales by floor area dropped 13.7% year to date, deepening from minus 13.1% previously. Home prices continued to slide, though the pace of decline moderated: new home prices fell 0.14% month on month in September versus minus 0.17% prior, and used home prices fell 0.26% versus minus 0.31% prior, with the annual new home price decline narrowing to minus 2.8% from minus 3.0%. Fixed-asset investment excluding rural areas fell 7.2% year to date, slightly better than the minus 7.3% forecast.