China’s Q2 2026 GDP growth fell short of the official 4.5%-5% target, increasing pressure on policymakers to boost support in the second half.
China’s economy expanded 4.3% year-on-year in Q2 2026, below the government’s 4.5%-5% target and consensus forecasts. The slowdown marks the weakest growth in over three years, down from 5.0% in Q1 2026.
Fixed-asset investment contracted 5.7% in the first half, while June industrial output and retail sales exceeded expectations. H1 GDP reached 4.7%, leaving policymakers needing stronger H2 performance to meet annual goals.
The GDP deflator turned positive for the first time, signaling potential inflationary pressures amid the growth slowdown.