China's economic growth rebounds to 7.8pc

China's GDP has risen for the first time in three quarters.

China's economic growth rebounded to 7.8 per cent in the latest quarter after a boost in government spending to reverse a sharp downturn.

The data reported today should ease pressure on communist leaders for new stimulus measures to prevent politically dangerous job losses. That would allow them to focus on what they say is their priority of longer-term reforms aimed at making China's economy more efficient and productive.

Growth of the world's second-largest economy accelerated from the previous quarter's two-decade low of 7.5 per cent, according to the National Bureau of Statistics.

"In the third quarter, the economy has seen some positive signs," said a bureau spokesman, Sheng Laiyun, at a news conference.

Communist leaders want to steer China's economy to a slower, more sustainable level based on domestic consumption instead of exports and investment.

The unexpectedly abrupt decline in global demand for Chinese goods prompted Beijing to reverse course temporarily and take targeted steps to prop up growth and avoid job losses.

Analysts have warned that the rebound might not last because growth is being supported by government spending. Global demand is weak and Chinese consumer spending is growing more slowly than Beijing wants.

Factory output in the three months ended September rose 10.1 per cent from a year earlier, up 1 percentage point from the growth rate in the first half of the year, Sheng said.

Growth in investment in factories and other fixed assets edged up, growing 20.2 per cent in the first three quarters of the year, compared with 20.1 per cent for the first half, the data showed. Retail sales also accelerated but only marginally, rising by 12.9 per cent in the first three quarters.

-AP