China’s economy grows 4.3% in Q2, slowest since late 2022

China reported a 4.3% annual growth rate for the second quarter of 2026. This marks the slowest expansion since the end of 2022. While export manufacturing continues to provide a foundation for the national economy, the results sit below earlier projections and represent a deceleration from the first quarter.

Strong performance in high-tech sectors, including artificial intelligence and electric vehicles, remains the primary driver of current output. Custom data indicates exports rose significantly over the first half of the year. However, this sector-specific strength does not translate into broader national momentum.

Domestic demand remains weak as families reduce spending on major purchases. The property market continues to face a prolonged slump, which influences consumer behavior and wage expectations. Business investment is also lagging, as fixed asset investment dropped by 5.7% during the first half of the year.

Government officials noted that the gap between strong supply and soft demand remains a core challenge. While leaders prioritize the development of advanced technologies, the reliance on external trade creates an unbalanced economic model. Experts point to these structural issues as factors that limit the current path toward growth targets for the remainder of the year.