Growth has slowed, with real estate investment cooling dramatically. In Q3, GDP was up 4.9% y/y, the same rate as in Q3 2020, and lower than in Q2 2021. Industrial output in Q3 fell dramatically, rising 4.9% y/y, down 0.9 pps from Q3 2020, and up 2.1% y/y in September.
Investment was up 7.3% y/y, with annualized growth of 4%, down 0.5 pps from H1. Consumption rose 5.1% y/y in Q3, and retail sales grew 3.2% y/y in real terms. Sales had an annualized growth rate of 3%, down 1.6 pps from Q2. In Q3 2021, trade was still strong, though weaker than in Q2. Exports in Q3 rose 14.5% y/y, down 5.6 pps from Q2. Imports increased 16.2% y/y, down 15.4 pps.
CPI rose 0.7% y/y in September, after falling for four consecutive months, and was still down 0.3 ppts from August. We believe CPI growth will rebound soon. Monetary policy continued its tightening trend in September. In particular, M1 was up 3.7% y/y, and down 0.5 pps from August. RMB loans from financial institutions were up 11.9% y/y, their lowest growth rate since 1990.
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