China's economy grows 4.3% in Q2, missing market expectations

China's economy expanded at its slowest pace in nearly four years during the second quarter of 2026, as weak domestic demand and a prolonged downturn in the property sector weighed on growth, AzerNEWS reports.

According to official data, China's gross domestic product (GDP) grew 4.3% year-on-year in the second quarter, falling short of market expectations of 4.5% and slowing from the 5% growth recorded in the first quarter. The latest reading marks the country's weakest annual growth rate since the fourth quarter of 2022.

On a quarterly basis, the economy expanded 0.9%, in line with analysts' forecasts but down from the 1.3% growth recorded in the previous quarter.

The slowdown was driven largely by continued weakness in the real estate sector, where investment declined 18% during the quarter. Soft consumer spending and subdued domestic demand also continued to weigh on overall economic activity.

Despite these challenges, the industrial sector remained resilient. Industrial production increased 5.3% during the reporting period, underscoring the continued contribution of manufacturing and exports to economic growth.

Analysts say that unless domestic demand recovers and the property market stabilizes, China's economy is likely to remain on a slower growth trajectory in the coming quarters.