China's economy grows 4.5% in third quarter as AI boom lifts exports

China's economy grew by 4.5% in the three months to the end of September, according to figures released on 19 October 2026. The result marks a rebound from the 4.3% recorded in the previous quarter, which had been the weakest pace in three years. Exports fuelled by the global artificial intelligence investment boom drove much of the improvement.

Growth still fell short of the 5% expansion seen between January and March. The latest reading sits at the lower edge of Beijing's annual target range of 4.5% to 5%, a position analysts say leaves officials some room to tackle the country's deeper economic problems.

Chips for AI data centres

Technology has become one of the main engines of Chinese growth over recent quarters. Worldwide demand for computer chips and other parts used to build AI data centres has relieved some pressure on Beijing and softened the blow from weak consumption at home.

As shipments abroad rise, China's trade surplus is on course to exceed last year's record of $1.2tn. Chinese firms have turned to foreign markets because a long-running property slump, slow wage growth and high youth unemployment continue to hold back household spending.

In September, Beijing announced a package of support measures aimed at reviving the economy, including lower interest rates for some businesses and subsidies for people buying property.

Trade friction and AI doubts

The export-led recovery carries risks. Western economies, among them the United States and the European Union, are pushing back against Beijing as their manufacturers struggle against large volumes of low-cost Chinese goods. There are also growing questions over the billions of dollars flowing into AI infrastructure, and whether the companies behind that spending can produce the large profits they have promised.

The figures underline how closely the fortunes of the world's second largest economy are now tied to the AI build-out. Any slowdown in data centre investment could weaken one of the few bright spots in China's economic picture.