China's growth slows in third quarter, weakest in 27 years

China's economy has been hit by cooling domestic demand and the long-running trade dispute with the United States

China's growth slumped to 6 per cent in the third quarter of 2019, its lowest level in almost three decades, as the world's second largest economy struggled to overcome the impact of a bruising trade war with the U.S. and sluggish domestic demand, according to official data released on Friday.

Factory output growth slowed to 5.6 percent in the January-September period, down from 6 percent in the first six months of the year.

According to recent market data in the last quarter, Beijing saw its growth sink by 6%.

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Downbeat data in recent months has highlighted weaker demand at home and overseas.

The figures are the latest to indicate a softening in the economy.

The slump adds to problems faced by Chinese leaders, including rising inflation and weaker consumer demand, as they fight a tariff war with President Donald Trump over Beijing's trade surplus and technology ambitions.

China's army of consumers were starting to open their wallets again, with retail sales edging up 7.8 percent on-year in September, compared with 7.5 percent in August.

But fixed-asset investment slid to 5.4 percent on-year in January-September, from 5.5 percent in January-August, as the government warned against risky borrowing to build roads and bridges that could artificially pump up GDP in the short run. Manufacturing is in trouble and the trade war is biting.

The drags on demand, both domestic and global, have hit several key parts of the economy, with weakness seen in freight shipments, factory power generation, employment and entertainment spending. For instance, the headline growth rates rose 1.4ppt in September, and 1.3ppt in June.

"We feel that the global economy and global trade are increasingly moving towards reducing protectionism and. freedom", he said.

Top trade negotiators for the United States and China reached a preliminary trade deal last Friday. China's commerce ministry spokesman Gao Feng said Thursday that its negotiators have "accelerated efforts" to hammer out the details of this mini-deal, and the two sides were aiming for an "early agreement".

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