China’s economy slowed sharply to a 4.3% annualized pace of growth in the April-June quarter, the government said Wednesday, the weakest in over three years.
The official data fell short of forecasts and was far below the economy’s strong 5% pace of growth in January-March, despite a surge in exports driven partly by the boom in artificial intelligence, and by robust global demand for Chinese electric vehicles.
China has largely shrugged off wider economic impacts from the Iran war as soaring energy prices pushed up global inflation. Exports rose 17.6% in the first half of the year from a year earlier, and 27% in June, according to customs data.
But domestic spending and investment have lagged, limiting the boost from export manufacturing for an economy that has struggled to regain momentum since parts of China were locked down during the COVID-19 pandemic.
“This was the slowest growth in any quarter since the lockdown-impacted fourth quarter of 2022,” said Lynn Song, chief economist for Greater China at ING Bank in a note.
