China's economy continued to moderate in the third quarter as the government weans the economy from the stimulus and back to normal. But rising inflation posed new challenges.
The gross domestic product (GDP) grew 9.6 percent in the third quarter from the same period last year, the National Bureau of Statistics (NBS) said on Thursday.
The growth rate slowed down from 11.9 percent in the first quarter and10.3 percent in the second quarter.
Last year's higher comparison base contributed to the deceleration. Also, the government's measures to cool the housing market and bank lending, as well as the closing of outdated industrial capacity, slowed growth, said Zhu Baoliang, a researcher with the State Information Center.
"The economic performance is generally sound," Sheng Laiyun, NBS's spokesman, told a press conference.
The benchmark Shanghai Composite Index closed down 0.68 percent, or 20.42 points, Thursday at 2,983.53.
From January to September, GDP increased by 10.6 percent year-on- year to 26.866 trillion yuan (about 4.028 trillion U.S. dollars), the NBS said.
"In the face of complicated and fast-changing domestic and international situations and challenges, China implemented the stimulus package and sped up economic restructuring. The economic turnaround has been further consolidated and is moving in the anticipated direction," Sheng said.
In September, the consumer price index (CPI), a main gauge of inflation, rose 3.6 percent year on year, a 23-month high. It was also the third consecutive monthly acceleration.
Food prices, which account for about one third of the weighting in calculating the CPI, climbed 8 percent year on year last month, because of "adverse natural conditions", as Sheng explained.
Soaring international commodity prices and the loose monetary policies of a number of countries posed challenges for the Chinese government in keeping inflation around the annual three percent target.
Domestically, runaway property prices, and frequent extreme weathers which pushed up food prices, also helped fuel inflation.
Sheng said although price increase pressure still remained, it was still "possible" to achieve the three percent target, if the right measures were implemented for the rest of the year.
As money supply and credit expansion moderated in the second half of the year, inflation pressure from the monetary perspective is lessened, said Zhang Liqun, a researcher with the Development and Research Center of the State Council.
On Oct. 19, China's central bank surprisingly announced it would raise the one-year deposit and lending rates by 25 basis points to tame rising inflation amid swelling asset bubbles.
Sheng said the interest rate rise will help absorb liquidity and promote economic restructuring.
To curb China's runaway housing prices, the government has raised the ratio of mortgage down-payment for home buyers and completely halted bank lending to third-home buyers.
Sheng said speculative demands have been "prominently checked" with falling house trading in major cities. Construction of affordable housing also has picked up speed.
Industrial value-added output year-on-year growth slowed to 13.3 percent in September from 13.9 percent in August, as a result of higher comparison basis, and high energy-consuming manufacturers's production scaled-down.
In the first nine months, fixed asset investment rose 24 percent year on year while retail sales increased 18.3 percent.
The growth rates all slowed because of the high comparison basis of last year, when the economy staged a rapid recovery on the government's 4-trillion yuan stimulus package.
Sheng said despite the sound momentum, much hard work and realistic thinking was still needed as the economy was at a crucial transition point.
"The pace of the world's major economies's recovery are still faltering, and domestically, new problems propped up," he said.
He said the government would keep its macro-economic policy "consistent and stable," and make it more "targeted and flexible."
"More efforts will be made to transform the economic development mode, deepen opening-up and reform, improve people's lives and ensure stable and relatively fast economic growth," he said.
China has just mapped out a blueprint for its social and economic development for the next five years, with the aim to achieve a "major breakthrough" in economic restructuring while maintaining "stable and relatively fast" economic growth.
The government is focusing less on growth rate figures and more on rebalancing the economy to make it less dependent on exports and investment and more reliant on domestic consumer spending.
Zhang Liqun forecasts full year GDP growth at between 9.5 percent and 10 percent.
Liu Wei, a professor at China Renmin University, expects growth to further slow in the fourth quarter on the back of less fixed-asset investment and weak exports, as the world's other major economies continue to grapple with a fragile economic recovery.
The gross domestic product (GDP) grew 9.6 percent in the third quarter from the same period last year, the National Bureau of Statistics (NBS) said on Thursday.
The growth rate slowed down from 11.9 percent in the first quarter and10.3 percent in the second quarter.
Last year's higher comparison base contributed to the deceleration. Also, the government's measures to cool the housing market and bank lending, as well as the closing of outdated industrial capacity, slowed growth, said Zhu Baoliang, a researcher with the State Information Center.
"The economic performance is generally sound," Sheng Laiyun, NBS's spokesman, told a press conference.
The benchmark Shanghai Composite Index closed down 0.68 percent, or 20.42 points, Thursday at 2,983.53.
From January to September, GDP increased by 10.6 percent year-on- year to 26.866 trillion yuan (about 4.028 trillion U.S. dollars), the NBS said.
"In the face of complicated and fast-changing domestic and international situations and challenges, China implemented the stimulus package and sped up economic restructuring. The economic turnaround has been further consolidated and is moving in the anticipated direction," Sheng said.
In September, the consumer price index (CPI), a main gauge of inflation, rose 3.6 percent year on year, a 23-month high. It was also the third consecutive monthly acceleration.
Food prices, which account for about one third of the weighting in calculating the CPI, climbed 8 percent year on year last month, because of "adverse natural conditions", as Sheng explained.
Soaring international commodity prices and the loose monetary policies of a number of countries posed challenges for the Chinese government in keeping inflation around the annual three percent target.
Domestically, runaway property prices, and frequent extreme weathers which pushed up food prices, also helped fuel inflation.
Sheng said although price increase pressure still remained, it was still "possible" to achieve the three percent target, if the right measures were implemented for the rest of the year.
As money supply and credit expansion moderated in the second half of the year, inflation pressure from the monetary perspective is lessened, said Zhang Liqun, a researcher with the Development and Research Center of the State Council.
On Oct. 19, China's central bank surprisingly announced it would raise the one-year deposit and lending rates by 25 basis points to tame rising inflation amid swelling asset bubbles.
Sheng said the interest rate rise will help absorb liquidity and promote economic restructuring.
To curb China's runaway housing prices, the government has raised the ratio of mortgage down-payment for home buyers and completely halted bank lending to third-home buyers.
Sheng said speculative demands have been "prominently checked" with falling house trading in major cities. Construction of affordable housing also has picked up speed.
Industrial value-added output year-on-year growth slowed to 13.3 percent in September from 13.9 percent in August, as a result of higher comparison basis, and high energy-consuming manufacturers's production scaled-down.
In the first nine months, fixed asset investment rose 24 percent year on year while retail sales increased 18.3 percent.
The growth rates all slowed because of the high comparison basis of last year, when the economy staged a rapid recovery on the government's 4-trillion yuan stimulus package.
Sheng said despite the sound momentum, much hard work and realistic thinking was still needed as the economy was at a crucial transition point.
"The pace of the world's major economies's recovery are still faltering, and domestically, new problems propped up," he said.
He said the government would keep its macro-economic policy "consistent and stable," and make it more "targeted and flexible."
"More efforts will be made to transform the economic development mode, deepen opening-up and reform, improve people's lives and ensure stable and relatively fast economic growth," he said.
China has just mapped out a blueprint for its social and economic development for the next five years, with the aim to achieve a "major breakthrough" in economic restructuring while maintaining "stable and relatively fast" economic growth.
The government is focusing less on growth rate figures and more on rebalancing the economy to make it less dependent on exports and investment and more reliant on domestic consumer spending.
Zhang Liqun forecasts full year GDP growth at between 9.5 percent and 10 percent.
Liu Wei, a professor at China Renmin University, expects growth to further slow in the fourth quarter on the back of less fixed-asset investment and weak exports, as the world's other major economies continue to grapple with a fragile economic recovery.
