Classifieds | Archives | Jobs | About TGT | Contact | Subscribe
 | 
Last updated 4 minutes ago
Printer Friendly Version | TGT@Twitter | RSS Feed |
HOME LOCAL MIDEAST ASIA WORLD BUSINESS SPORT OPINION WRITERS
China factory output, retail sales miss forecasts
August 15, 2017
 Print    Send to Friend

BEIJING: China’s factory output slowed more than expected in July while investment and retail sales also disappointed, reinforcing views that the world’s second-largest economy is starting to lose some steam as lending costs rise and the property market cools.

Factory output rose 6.4 per cent in July from a year earlier, the slowest pace since January this year, statistics bureau data showed on Monday.

Analysts polled by Reuters had predicted factory output would grow 7.2 per cent in July, down from 7.6 per cent in the previous month.

Fixed-asset investment grew 8.3 per cent in the first seven months of the year, cooling slightly from 8.6 per cent in the first half of the year. Analysts had expected the growth rate would remain steady.

Despite the softer-than-expected reading, China’s manufacturing activity still appeared to be supported by a year-long construction boom. Beijing has poured money into infrastructure projects that have fuelled demand for products from construction equipment to building materials from cement to steel.

Relatively resilient economic growth is no doubt welcome news for President Xi Jinping ahead a major political leadership reshuffle in autumn, with authorities keen to ensure a smooth run-up to the meeting.

Any sharp drop in industrial activity, which appears to be a low-risk at this stage, would be a concern for policymakers as it risks rippling across the broader economy.

Still, China’s surprising strength so far this year seems unlikely to last. A government crackdown on riskier types of lending has driven a slowdown in credit growth and pushed up financing costs, which are expected to start weighing on the economy in coming months.

Average lending rates edged up to 5.67 per cent in June from 5.53 per cent in March, China’s central bank said on Friday in its second-quarter policy report, adding it will continue working to fend off risks to the financial system.

Concerns about the outlook for domestic demand resurfaced last week after Beijing reported weaker-than-expected import and export data.

Though some economists chalked up softer imports to seasonal or one-off factors such as bad weather, others said it may be a sign that China’s trade growth peaked in the second quarter and is now on a downward trend.

Retail sales rose 10.4 per cent in July from a year earlier, cooling from June’s 11 per cent pace and also failing to meet analysts’ expectations for a 10.8 per cent rise.

To be sure, China has surprised most pundits all year, with the economy growing a faster-than-expected 6.9 per cent in the first half, turbo-charged by heavy government spending, a hot housing market and record bank lending last year.

Reuters

Add this page to your favorite Social Bookmarking websites
Comments
 
Post a comment
 
Name:
Country:
City:
Email:
Comment:
 
    
    
Related Stories
China, UK vow to bolster economic ties
BEIJING: China and Britain have vowed to continue and strengthen cooperation on a wide range of economic, financial and trade issues, including speeding the introduction ..
China’s producer prices ease to 4-month low
BEIJING: China’s producer price inflation slowed to a four-month low in November as factory activity softened due to the government’s ongoing efforts to curb pollution, c..
China FX reserves rise to $3.119 trillion
BEIJING: China’s foreign exchange reserves rose for a 10th straight month in November, though slightly less than market expectations, as tight regulations and a strong yu..
S&P downgrades China's credit rating
BEIJING: S&P Global Ratings downgraded China’s long-term sovereign credit rating on Thursday, less than a month ahead of one of the country’s most sensitive political gat..
Steady China factory inflation a boon for profits
BEIJING: China’s factory price inflation held steady in July in a positive sign for industrial output and profits for the third quarter, even though a government-led driv..
FRONTPAGE
 
GALLERY
 
PANORAMA
 
TIME OUT
 
SPORT
 
 
Advertise | Copyright