World Bank projects China’s growth slowing to 4.4% in 2026

The World Bank on Tuesday released its latest China Economic Update, projecting that China's economic growth will slow to 4.4% in 2026 and ease further to 4.3% in 2027, as a prolonged property market correction and cautious consumers weigh on the world's second-largest economy.worldbank+1

Resilience Amid Headwinds

The report, titled "Rebalancing Growth," found that China's economy remained resilient in early 2026, buoyed by strong high-tech investment and exports. Policy support and buffers against global energy supply disruptions partly offset weaker domestic demand in the second quarter, the World Bank said. The bank added that risks to the outlook are "broadly balanced," though renewed volatility in global energy supply and oil prices remains a concern.english.news+1

The 4.4% projection sits below Beijing's own growth target of 4.5% to 5% for 2026, set in March — the lowest official benchmark since 1991, according to Bloomberg. The target range marked the first time in more than three decades that China placed its goal below the 5% threshold.bloomberg+2

Property Sector Remains the Drag

The housing market continues to cast a long shadow over the economy. Data from the National Bureau of Statistics showed that new-home prices in 70 major cities fell 0.2% month-on-month in May, with first-tier cities managing modest gains while lower-tier cities continued to decline. Year-on-year, first-tier city new-home prices were down 1.7% in May, narrowing from April's drop. Real estate investment in the January-to-May period plunged 16.2% year-on-year, according to official data.bloomberg+2

In the secondary market, the picture was grimmer. A China Index Academy survey released in early July showed resale prices across 100 cities fell 0.42% month-on-month in June, with 88 of those cities recording declines. Among the 10 largest cities, Nanjing and Wuhan posted the steepest year-on-year drops, at 11.45% and 10.89% respectively.asiatimes+2

Upside Risks and Outlook

The World Bank noted that growth could exceed its baseline if fiscal stimulus and artificial intelligence-related investments prove stronger than expected. China's government has so far relied on incremental policy steps rather than large-scale intervention to stabilize the housing sector, a strategy that analysts say has yet to restore buyer confidence. Progress in rebalancing the economy toward consumption "remains gradual," the bank said.tradingeconomics+2