Beijing: China’s economy lost momentum in the third quarter of 2025, expanding at its slowest pace in a year as a deepening property crisis, fragile consumer confidence, and external trade challenges continued to weigh on growth. Official data showed that the gross domestic product (GDP) grew 4.8 percent year-on-year between July and September, matching market forecasts but slipping from the 5.2 percent recorded in the previous quarter. On a quarterly basis, growth stood at 1.1 percent, only a slight improvement from the revised 1.0 percent in the second quarter.
The figures highlighted growing strain within the world’s second-largest economy, which has been struggling to maintain its post-pandemic recovery amid structural weaknesses. Economists said the latest slowdown underscores the limited impact of recent government measures and is likely to intensify pressure on Beijing to roll out stronger fiscal and monetary support to achieve its annual growth target of around 5 percent.
One of the main drags on the economy remains the property sector, which has been in a prolonged downturn. Property investment fell 13.9 percent in the first nine months of the year, reflecting a steep decline in new projects, falling home prices, and widespread developer distress. The ongoing slump has eroded consumer wealth and confidence, further curbing household spending and financial activity.
Consumer demand remained muted despite a gradual improvement in industrial output. Retail sales rose just 3 percent in September from a year earlier, the weakest performance since late 2024, suggesting that households continue to prioritize savings over spending. Industrial production, however, showed a more encouraging trend, climbing 6.5 percent year-on-year in September the fastest pace in three months driven by strong performance in electric vehicles, green technologies, and manufacturing exports.
Fixed-asset investment across major sectors slipped by 0.5 percent in the first nine months of 2025, reversing earlier gains. The data point to slowing infrastructure spending, which had been one of the few pillars of support for growth earlier in the year. Analysts warned that without fresh injections of government spending or targeted stimulus to boost domestic demand, the momentum could fade further in the coming months.
Economists believe that Beijing now faces a crucial balancing act between promoting near-term growth and ensuring long-term economic stability. While the government has so far relied on modest fiscal support and credit easing, calls are growing for more decisive action, including measures to revive the property market and stimulate consumer spending. Upcoming high-level policy meetings, including the Communist Party’s Politburo session and the annual Central Economic Work Conference, are expected to shape the economic strategy for the final quarter and beyond.
China’s slowdown is also reverberating across global markets. As the world’s second-largest economy and a major driver of international trade, weaker Chinese demand has implications for commodity prices, emerging market exports, and global supply chains. Economists note that sustained weakness in China could further dampen global growth prospects, particularly for nations closely tied to its trade network.
For Beijing, the latest data serve as both a warning and an opportunity to recalibrate its policy approach, accelerate structural reforms, and rebuild consumer and investor confidence. Whether it opts for aggressive stimulus or measured adjustments, the direction it takes in the coming months will have far-reaching consequences, both domestically and globally.