China's Economy Grew 4.3% in Q2 While Exports Rose 27% in June

China's economy expanded at a 4.3% annualized pace in the April-June quarter, the government reported Wednesday, the weakest quarterly growth in more than three years. The reading fell short of forecasts and marked a sharp slowdown from the 5% pace recorded in the first quarter.

Exports provided the main support, rising 17.6% in the first half of 2026 from a year earlier and 27% in June alone, according to customs data.

Industrial output by value increased 5.4% over the same six-month period. Overall growth for the first half reached 4.7%. Domestic demand stayed subdued. Fixed-asset investment fell 5.7% year on year in the first half, while retail sales of consumer goods rose only 1.3%.

Housing prices continued to decline. Mao Shengyong, deputy head of the National Bureau of Statistics, told reporters that the imbalance between strong supply and weak demand remains acute. He said authorities will work to build a robust domestic market and support stable employment.

Chinese leaders set an annual growth target of 4.5% to 5% for 2026, below last year's 5% outcome. The International Monetary Fund recently raised its 2026 forecast for China by 0.2 percentage points to 4.6% and projects 4.1% growth in 2027.