Multiple Chinese economic indicators missed expectations yesterday, with consumption and investment growth figures falling to multiyear lows, underlining sluggish momentum in the world’s second-largest economy.
Growth in retail sales, a key indicator of consumer spending, fell to 10 percent last month, China’s National Bureau of Statistics said, the weakest for nine years.
Fixed asset investment, a measure of government spending on infrastructure, expanded 12 percent in the first four months of the year, the lowest since 2000.
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The median forecasts in polls of economists by Bloomberg News were for retail sales to rise 10.4 percent and fixed asset investment to climb 13.5 percent.
Industrial output, which measures production at factories, workshops and mines, rose 5.9 percent last month, according to the bureau, improving from a 5.6 percent gain in March, but also weaker than economists’ estimate of 6 percent.
The statistics are the latest poor data to emerge in China, a key driver of global expansion, suggesting that stimulus measures taken by Beijing have yet to have an effect.
The People’s Bank of China on Sunday announced its third interest rate cut since November last year, and this year has twice reduced the amount of cash lenders must keep in reserve, as well as using other measures to inject liquidity into the market.
China’s GDP grew 7.4 percent last year, the lowest rate in 24 years. Expansion slowed further to 7 percent in the January-March period, the worst quarterly result in six years and down from 7.3 percent in the final quarter of last year.
Australia and New Zealand Banking Group economists said the latest figures indicated GDP growth may have decelerated to below the government’s annual target of 7 percent.
“Thus, more growth stabilisation policies could be expected to roll out,” they wrote in a note.
Continued falls in last month’s exports and imports announced last week added to concerns over weakening momentum in China, while persistent mild consumer inflation statistics left room for further policy loosening.
Capital Economics analysts Julian Evans-Pritchard said the effects of government policy moves would become clearer with time.
“The People’s Bank’s looser policy stance should begin to shore up activity in the coming months,” he said in a report.
“Policymakers ... are likely to respond to any further signs of weakness by continuing to step up policy support to ensure that growth doesn’t slip much further,” he said.
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