Financial News: China Economic Data Damps Hopes Of Speedy Recovery

China Economic Data Damps Hopes Of Speedy Recovery

08/15/2024 - 05:27:00 (RTTNews)

(RTTNews) - China's industrial production and investment logged another slower growth in July, while retail sales growth showed a moderate improvement on the back of government support measures, indicating a fragile recovery at the start of the third quarter.

Industrial production posted a 5.1 percent yearly growth in July, weaker than June's 5.3 percent increase, the National Bureau of Statistics said Thursday. This was also slower than economists' forecast of 5.2 percent.

During January to July period, fixed asset investment climbed only 3.6 percent as real estate investment worsened further. This was slower than forecast of 3.9 percent.

Property investment decreased 10.2 percent from a year ago. Infrastructure and manufacturing investment growth also softened.

However, suggesting rebalancing of growth away from investment towards consumption, retail sales climbed at a faster pace of 2.7 percent annually in July, improving from the 2.0 percent expansion seen in June. Sales were forecast to grow 2.6 percent.

Nonetheless, the housing market downturn continued to drag on consumer spending. The unemployment rate rose to 5.2 percent in July from 5.0 percent in June. The rate was seen at 5.1 percent.

Today's data suggest that economic growth probably edged down slightly at the start of the third quarter, economists at Capital Economics said.

The government is expanding fiscal support, which should help prop up domestic demand and drive a modest recovery over the rest of this year, they noted.

Today's data underlined the challenges in achieving government's ambitious growth target of around 5.0 percent this year. In the June quarter, the second-largest economy posted a slower growth of 4.7 percent after rising 5.3 percent in the preceding period.

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