China economy likely to show recovery is fading quickly

China's economic recovery is losing momentum as pent-up demand, government stimulus and surprisingly resilient exports fade.

The renewed coronavirus outbreak and softening global growth are testing Beijing's resolve to keep up policy support.

China's economy grew 4.9% in the third quarter from a year earlier, slower than the second quarter's 3.2% growth.

Retail sales, a key gauge of consumption, fell 7.2% in the first three quarters from a year earlier.

Industrial output rose 5.8% in September from a year earlier, slower than the 6.9% growth in August.

Fixed-asset investment fell 0.8% in the first nine months from a year earlier.

China's central bank has been cautious in cutting interest rates, fearing a surge in debt and property prices.

The government has also been reluctant to unleash another massive stimulus package like the one in 2008-09, which left a legacy of debt and excess capacity.

The International Monetary Fund has forecast China's economy will grow 1.9% this year, the only major economy expected to expand.

The IMF has also warned that China's recovery could be derailed by a resurgence of COVID-19 cases or a renewed global downturn.