China’s Economy Bounces Back, Grows 6.7% in 3rd Quarter

By | Oct 19, 2016 09:28 AM EDT
Chinese Economy.

The Chinese economy grew at 6.7 percent in the third quarter of current financial year, bouncing back firmly on the track to meet government’s annual growth rate target of 6.5 percent.(Photo : getty images. )

The Chinese economy is showing signs of bouncing back after it registered a growth rate of 6.7 percent in the third quarter of the current financial year, the National Bureau of Statistics said on Wednesday.

The robust growth rate has indicated that the world's second largest economy is now back on track to meet the government's annual growth rate target of 6.5 percent.

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The rate is also within Reuters prediction. However, there has been a concern on sustaining this, as officials are busy trying to cool down the real estate sector, the traditional growth engine of the Chinese economy.

"The recent recovery is ultimately on borrowed time given that it has been driven in large part by faster credit growth and a property market boom, both of which policymakers are now working to rein in," said Evans-Pritchard, China economist at Capital Economics.

The National Bureau of Statistics said in a note that the economy is still in transition phase, as the traditional growth driver is being steadily replaced by new ones.

"With unstable and uncertain domestic and external factors, the foundation for continued economic growth is not solid enough," it added.

Analysts are equally concerned about the slump in private investment and mounting debt, as they reportedly continue to cast shadow on the Chinese economy.  

Another set of data released on Wednesday showed that the industrial output was up by 6.1 percent on a yearly basis, which is below Reuters' prediction of 6.4 percent. Meanwhile, the retail sales increased by 10.7 percent on yearly basis, with fixed asset investment posting a surge of 8.2 percent during the first three quarters of the year.

The Chinese economy has been on a slide since the middle of last year, keeping global investors on edge. Economists have described the current downturn as the worst the country has seen in over two decades. However, government officials have ruled out any possibility of "hard landing" for the Chinese economy.    

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