China’s GDP growth likely to surpass 5% in Q3: experts
The third quarter would continue the robust recovery trend on the basis of the second quarter, which reflected a V-shaped rebound, they said, meanwhile pointing out potential challenges in the fourth quarter mainly caused by the complicated external environment represented by the US presidential election.
GDP in the world's second-largest economy grew by 3.2 percent year-on-year in the second quarter, beating analysts' expectations and rebounding from the first quarter's contraction of 6.8 percent, as it took a huge hit from the outbreak of the COVID-19 pandemic.
Wang Jun, an expert at the China Center for International Economic Exchanges in Beijing, told the Global Times on Friday that many economic indicators in both manufacturing and services sectors have turned positive growth since the beginning of the third quarter, led mainly by consumption and investment.
"The exports data also beat expectations," said Wang.
He forecast a 5.2-5.4 percent GDP growth in the quarter. The official data is scheduled to be released on October 19 by the National Bureau of Statistics (NBS).
Lian Ping, head of the Zhixin Investment Research Institute, told the Global Times that China's overall macroeconomic policy will remain steady and domestic demand is set to accelerate the pace of recovery for the rest of the year.
Lian estimated the third quarter will register growth as high as 6 percent, while for the full year of 2020, the rate might reach around 3 percent.
The country's economy has sustained a steady recovery as factories stepped up production and retail sales expanded for the first time this year in August.
In the first eight months, industrial output expanded 0.4 percent from a year earlier, compared with a decline of 0.4 percent in the January-July period, data from the NBS showed.
Retail sales of consumer goods, a major indicator of consumption growth, rose 0.5 percent year-on-year in August, according to NBS, reversing a seven-month downturn.
While exports grew 0.1 percent and imports contracted 9.7 percent during the second quarter, average monthly exports growth in July and August recorded more than 8 percent.
"With other economies gradually walking out of the pandemic, China's exports might face increasing pressure," said Wang Tao, UBS' chief China economist.
According to Wang's forecast, China's GDP growth in the third quarter and fourth quarter will both stay at the range of 5.5-6 percent, while 2.5 percent for the full year.
Accelerated recovery of infrastructure investment can be seen in the fixed-asset investment sector with sales of construction machinery such as excavators and heavy-duty trucks rebounding sharply for several consecutive months, said Lian.
Latest industry data from cvworld.cn showed Friday that in September, sales of China's heavy-duty truck market are expected to reach 136,000 vehicles, an increase of 5 percent month-on-month and 63 percent year-on-year.
Sales of excavators are expected to reach 26,000 units in the month, up 64 percent yearly, according to the survey of CME Construction Machinery Network.
Heavy-duty trucks and excavators are treated as major barometers of China's fix-asset investment.
China's fixed-asset investment edged down 0.3 percent year-on-year during the January-August period, with the decline narrowing from the 1.6-percent fall in the first seven months, official data showed.
A source close to Sany Heavy Industry, China's largest engineering machinery manufacturer, told the Global Times on Friday that the company's sales of excavators are expected to hit a year-on-year growth of 36 percent in 2020.
Despite the robust recovery of domestic supply and demand, increasing uncertainties remain in the fourth quarter for China's external environment as the US presidential election will occur in November, economists said.
"The bilateral relations between China and the US could continue to worsen, plus the threat of another wave of COVID-19 pandemic, disrupting external demand," Lian said.