China’s economy grows faster than forecast after AI boom boosts exports

Roaring exports lifted China’s economic growth in the third quarter of this year, with factory output growing much faster than consumer spending. China’s GDP grew by 4.5% year-on-year between July and September, the National Bureau of Statistics of China reported on Monday. The figures were better than economists had expected and up from the second quarter’s growth rate of 4.3%. China’s economy has now grown by 4.6% in the first nine months of the year, putting it on track to hit the government’s 2026 target of…

By the Truvace deskOctober 19, 20262 min read1 sourceJournalismTRV-2026-1880· cite & verify

China’s economy grows faster than forecast after AI boom boosts exports

In brief

China's statistics bureau reported 4.5% year-on-year GDP growth for July to September, better than economists expected and above the second quarter's 4.3%. Growth over the first nine months reached 4.6%, which keeps the economy on track for the government's 2026 target range without extra stimulus.

The figures show how far the AI hardware cycle is carrying China's growth, since export strength is offsetting a weak domestic economy. Whether this can be sustained is unclear, because the article describes consumer spending, property and infrastructure as still weak, and it notes other drags such as the Iran conflict.

Main points

Third-quarter GDP rose 4.5% year-on-year, up from 4.3% in the second quarter and better than economists forecast.
September industrial production rose 5.5%, while retail sales rose only 1.1%.
Exports surged by more than a third in September, helped by shipments of AI-related electronics.
Fixed-asset investment fell 7.2% over nine months, and property investment fell 20.6%.

The gain

Export demand for AI-related electronics and equipment helped push China's third-quarter GDP growth to 4.5%, above economists' expectations, and kept manufacturing output growing robustly.

The rundown

The National Bureau of Statistics reported the data on Monday. Factory output grew much faster than consumer spending, and growth of 4.6% over nine months leaves the economy on track for the 4.5%-5% target.

Pantheon Macroeconomics' Duncan Wrigley said manufacturing output grew 6.0% in September, helped by demand for electronics, AI-related equipment and autos. He added that hi-tech manufacturing is outperforming traditional sectors. Part of the September industrial rise also came from coalmines resuming operations after safety inspections.

ABN Amro analysts said the GDP pickup mainly reflects export strength on the global AI/tech boom. That strength more than offset drags from the Iran conflict and weak domestic demand.