Securities Times front page headline: Stable chassis, improved quality, new momentum, China's economy "stabilizing while improving quality"

On October 20, the National Bureau of Statistics released data showing that preliminary calculations indicate that the gross domestic product (GDP) for the first three quarters reached 101.5 trillion yuan, a year-on-year increase of 5.2% at constant prices. Among them, the GDP in the third quarter grew by 4.8% year-on-year and 1.1% quarter-on-quarter.

Analysis points out that the economy in the third quarter exhibited characteristics of "good growth in production supply, continuous improvement in domestic demand, and enhanced resilience in foreign trade." Looking ahead, with the accelerated cultivation of new productive forces and sustained macro policy efforts, China's economy is expected to continue to maintain a stable and positive trend.

Stable Foundation: 5.2% Growth Rate Shows Resilience

The GDP grew by 5.2% year-on-year in the first three quarters, accelerating by 0.2 and 0.4 percentage points compared to the entire previous year and the same period last year, respectively.

A spokesperson for the National Bureau of Statistics stated that this year, facing insufficient global economic growth momentum, complex external environments such as geopolitical conflicts and frequent international trade frictions, as well as insufficient domestic effective demand and challenges such as operational difficulties for some enterprises, China's economy achieved a 5.2% growth in the first three quarters, fully demonstrating the adaptability and strong resilience of the Chinese economy in an unstable and uncertain environment, and laying a solid foundation for achieving the main goals for the entire year.

Globally, the spokesperson pointed out that a 5.2% economic growth level ranks among the top among major economies, and China remains the most stable and reliable source of global economic growth.

Focusing on the third quarter, the GDP grew by 4.8% year-on-year, with the total economic output reaching 35.5 trillion yuan. Multiple indicators reflect the "stability" of the economy: the urban surveyed unemployment rate in the third quarter remained the same as the same period last year, the core CPI year-on-year growth rate continued to expand, and the decline in PPI narrowed for two consecutive months; the total import and export volume grew by 6.0% year-on-year, and foreign exchange reserves increased for two consecutive months; the trend of economic transformation and upgrading continued.

The spokesperson stated that the 4.8% economic growth rate in the third quarter is still significantly higher than that of most major economies, with the total economic output reaching 35.5 trillion yuan, surpassing the total economic output of the world's third-largest economy for the entire year of 2024. Achieving this economic growth rate is particularly commendable for such a large economy.

In the third quarter, the industrial sector maintained a good growth trend, with added value growing by 5.8% year-on-year. At the same time, domestic demand continued to improve, and the resilience of foreign trade was increasingly evident. In the third quarter, the contribution rates of final consumption expenditure, total capital formation, and net exports of goods and services to economic growth were 56.6%, 18.9%, and 24.5%, respectively.

Wang Qing, chief macro analyst at Dongfang Jincheng, believes that overall, the macro economy in the first three quarters has continued the strong growth trend since the fourth quarter of last year. Yuan Chuang, chief economist at Caixin Securities, told reporters that with the implementation of 500 billion yuan in new policy-based financial instruments and the early issuance of new local government debt limits for 2026, it is expected that manufacturing and infrastructure investment will still have certain resilience in the fourth quarter.

Quality Upgrade: Dual Upgrade of Industry and Consumption

"Continuous structural optimization" is a high-frequency term that experts used when analyzing the economic operation in the first three quarters. In the first three quarters, the added value of industrial enterprises above designated size grew by 6.2% year-on-year. Wang Xin, deputy director of the Industrial Statistics Division of the National Bureau of Statistics, stated that the industry structure has been continuously optimized in the first three quarters, and new productive forces have been cultivated and strengthened Taking "value added of the equipment manufacturing industry above designated size" as an example, in the first three quarters, this indicator grew by 9.7% year-on-year, with the cumulative value added accounting for 35.9% of all designated size industries, having exceeded 30% for 31 consecutive months, further highlighting its "ballast stone" role. At the same time, the processes of upgrading, intelligentization, and greening in the manufacturing industry continue to advance.

The investment and consumption structure is also continuously optimizing. In the first three quarters, national fixed asset investment (excluding rural households) reached 37.15 trillion yuan. Zhai Shanqing, Director of the Fixed Asset Investment Statistical Division of the National Bureau of Statistics, introduced that this year, the large-scale equipment renewal policy has shown significant effects, with the growth rate of equipment purchase investment consistently maintaining above 10%, serving as the main driving force for investment growth.

At the same time, the high-quality development of key industrial chains is steadily advancing, and the modernization of the industrial system is accelerating. In the first three quarters, industrial investment grew by 6.4% year-on-year, contributing 2.1 percentage points to overall investment growth; investment in high-tech services grew by 6.1% year-on-year, further increasing its share of total service industry investment.

In terms of consumption, in the first three quarters, final consumption expenditure contributed 53.5% to economic growth, an increase of 9.0 percentage points compared to the entire previous year, continuing to play the role of the main engine for economic growth. Residents' spending on services such as transportation, communication, education, and cultural entertainment grew rapidly, while the proportion of food, tobacco, and alcohol consumption in per capita expenditure decreased by 0.6 percentage points year-on-year, indicating a continued trend of consumption upgrading.

Consumption is a function of income. In the first three quarters, the per capita disposable income of residents nationwide nominally grew by 5.1% compared to the same period last year, and after deducting price factors, the actual growth was 5.2%, laying a foundation for the release of consumption potential.

New Momentum: Continuous Strengthening of High-Quality Development

Since the beginning of this year, new productive forces represented by artificial intelligence are accelerating their implementation. According to statistics, in the first three quarters, the output of industrial robots, service robots, and EMUs grew by 29.8%, 16.3%, and 8.6%, respectively.

The development of modern service industries is showing new and positive trends. From January to August, the operating income of enterprises in the information transmission, software, and information technology service industries above designated size grew by 12.1%, exceeding the growth of all service enterprises above designated size by 4.4 percentage points. In the first three quarters, investment in high-tech services grew by 6.1% year-on-year, surpassing the growth rate of total fixed asset investment by 6.6 percentage points.

Wang Qing believes that in the fourth quarter, the new productive forces represented by high-tech manufacturing will continue to maintain a rapid growth momentum, injecting sustained energy into high-quality economic development. Currently, fiscal policies to stabilize growth are being strengthened, and it is expected that under the impetus of these policies, the annual economic growth target of "around 5.0%" will be successfully achieved.

In the first three quarters, the number of foreign trade entities with import and export performance in China reached 700,000 for the first time, exceeding the total for the entire previous year, reflecting the continuous emergence of vitality among micro entities.

Customs-related surveys show that the confidence index of export enterprises has risen for five consecutive months, and the confidence index of import enterprises has also risen for three consecutive months. Surveys conducted by relevant institutions indicate that the business expectation index of industrial enterprises for the fourth quarter has increased by 1.4 percentage points month-on-month, and employment expectations have also improved Multiple physical quantities and confidence indicators corroborate each other: The industrial power generation above designated size increased by 1.6%, and the turnover of goods and passengers grew by 4.8% and 4.4%, respectively; the capacity utilization rate of industrial enterprises in the third quarter rebounded to 74.6%. Yuan Chuang stated that the M1 growth rate significantly rebounded by 1.2 percentage points to 7.2% in September, indicating a noticeable increase in the liquidity of funds. The activity levels of people flow, logistics, and capital flow have improved, reflecting an enhancement in the endogenous momentum of the economy.

Author of this article: Jiang Dan, Source: Securities Times, Original title: "Stable Chassis, Quality Improvement, New Momentum: China's Economy 'Stabilizing and Improving Quality'"

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