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China's GDP growth slowest in five years

China's gross domestic product dropped to 7.3 percent annually.

By Ed Adamczyk
Businesses in China commonly promote the quality of their products to be that of the "gold standard." UPI/Stephen Shaver
Businesses in China commonly promote the quality of their products to be that of the "gold standard." UPI/Stephen Shaver | License Photo

BEIJING, Oct. 21 (UPI) -- China's gross domestic product grew more slowly in the third quarter of 2014 than in the past five years, it reported Tuesday.

The growth rate of 7.3 percent, while still strong, is lower than the 7.5 percent growth reported in the previous quarter. The slowdown comes in the midst of an Asian financial crisis, a low rate of inflation and a slow housing market in China.

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"The sagging housing market has affected the economy more broadly, weighing on investment and on commodity production," wrote Alaistair Chan, Moody's Analytics economist.

The Chinese property sector has slowed considerably. It accounts for one-quarter of China's gross domestic product, and housing sales fell by 10.8 percent by value in the first nine months of 2014, the country's bureau of National statistics reported. The lack of inflation is indicative of an economy growing more slowly than its potential, with too much capacity and too little demand. The lower-than-expected metrics regarding China, the world's major engine of growth, could initiate concerns about the strength of the global recovery.

While an annual growth rate in the 7 percent range is admirable, China has said a 7.2 percent growth rate is required to create 10 million jobs annually for its growing population, estimated in July to be 1.335 billion.

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