China’s economy showed signs of stabilizing last month, with retail sales and factory output beating expectations as a power supply crisis appeared to ease, data released yesterday showed.
The recovery in the world’s second-largest economy has been losing steam for much of the year after a swift bounceback from harsh lockdowns to contain COVID-19, with officials earlier citing an “unstable and uneven” economic rebound.
Power outages in the past few months caused by emission reduction targets, the surging price of coal and supply shortages also affected factory production.
Photo: EPA-EFE
However, industrial production grew 3.5 percent year-on-year last month, the National Bureau of Statistics (NBS) said, as China worked to boost coal production and ease its energy shortage. A survey of economists tipped a 3.0 percent expansion.
NBS spokesman Fu Linghui (傅令輝) said yesterday that the “international environment remains complex and severe” with many uncertainties, adding that China needs to “work harder to maintain economic stability and recovery.”
“While electricity shortages and production cuts hampered output in early October, we don’t think they are a significant problem anymore,” Louis Kuijs of Oxford Economics said yesterday.
He added that this follows “a range of policy measures to boost coal production and lower coal prices.”
However, economic momentum remained weak last month, he said, “with the real estate downturn weighing on industry and a new wave of COVID outbreaks dampening household consumption.”
Retail sales rose 4.9 percent year-on-year last month, far exceeding forecasts for 3.7 percent, the latest data showed.
Yet observers warn that this could be bogged down by recent containment measures, reimposed following a fresh virus outbreak in the middle of last month that has spread to several regions.
Fu said that “domestic tourist numbers and income growth were below pre-pandemic levels” during the golden week holiday at the start of the month.
The urban unemployment rate remained at 4.9 percent.
Weakness in the economy is giving the country’s central bank a headache as it must try to nurture a recovery while at the same time keep a lid on inflation, which is at levels not seen since the mid-1990s.
France cannot afford to ignore the third credit-rating reduction in less than a year, French Minister of Finance Roland Lescure said. “Three agencies have downgraded us and we can’t ignore this cloud,” he told Franceinfo on Saturday, speaking just hours after S&P lowered his country’s credit rating to “A+” from “AA-” in an unscheduled move. “Fundamentally, it’s an additional cloud to a weather forecast that was already pretty gray. It’s a call for lucidity and responsibility,” he said, adding that this is “a call to be serious.” The credit assessor’s move means France has lost its double-A rating at two of the
AI BOOST: Although Taiwan’s reliance on Chinese rare earth elements is limited, it could face indirect impacts from supply issues and price volatility, an economist said DBS Bank Ltd (星展銀行) has sharply raised its forecast for Taiwan’s economic growth this year to 5.6 percent, citing stronger-than-expected exports and investment linked to artificial intelligence (AI), as it said that the current momentum could peak soon. The acceleration of the global AI race has fueled a surge in Taiwan’s AI-related capital spending and exports of information and communications technology (ICT) products, which have been key drivers of growth this year. “We have revised our GDP forecast for Taiwan upward to 5.6 percent from 4 percent, an upgrade that mainly reflects stronger-than-expected AI-related exports and investment in the third
Mercuries Life Insurance Co (三商美邦人壽) shares surged to a seven-month high this week after local media reported that E.Sun Financial Holding Co (玉山金控) had outbid CTBC Financial Holding Co (中信金控) in the financially strained insurer’s ongoing sale process. Shares of the mid-sized life insurer climbed 5.8 percent this week to NT$6.72, extending a nearly 18 percent rally over the past month, as investors bet on the likelihood of an impending takeover. The final round of bidding closed on Thursday, marking a critical step in the 32-year-old insurer’s search for a buyer after years of struggling to meet capital adequacy requirements. Local media reports
RARE EARTHS: The call between the US Treasury Secretary and his Chinese counterpart came as Washington sought to rally G7 partners in response to China’s export controls China and the US on Saturday agreed to conduct another round of trade negotiations in the coming week, as the world’s two biggest economies seek to avoid another damaging tit-for-tat tariff battle. Beijing last week announced sweeping controls on the critical rare earths industry, prompting US President Donald Trump to threaten 100 percent tariffs on imports from China in retaliation. Trump had also threatened to cancel his expected meeting with Chinese President Xi Jinping (習近平) in South Korea later this month on the sidelines of the APEC summit. In the latest indication of efforts to resolve their dispute, Chinese state media reported that
RSS