China industrial output growth falls to 17-year low

August 14, 2019 12:03
Chinese authorities will be concerned over July economic data, which showed marked weakening in industrial output and retail sales growth, among other key indicators. Photo: Reuters

China reported a slew of weak economic data on Wednesday, including a slide in industrial output growth to a more than 17-year low, as the country grapples with a US trade war.

Industrial output grew 4.8 percent in July from a year earlier, weakening from a 6.3 percent pace in the previous month, according to figures from the National Bureau of Statistics, Reuters reports.

Analysts had expected a figure of 5.8 percent.

Meanwhile, retail sales growth was also weaker than the most pessimistic forecast, after a jump in July that many analysts had predicted would be temporary.

Retail sales rose 7.6 percent in July from a year earlier, compared with 9.8 percent in June and analysts’ expectations of 8.6 percent.

Among other data, fixed-asset investment rose 5.7 percent in January-July from the same period last year, lagging expectations of a 5.8 percent gain, the same as Jan-June.

Investment readings by sector showed a more marked loss of momentum in key sectors at the start of the third quarter, Reuters noted.

Private sector fixed-asset investment, which accounts for about 60 percent of the country’s total investment, grew 5.4 percent in January-July, compared with a 5.7 percent rise in the first sixth months of 2019.

Property investment grew 10.6 percent in the first seven months of the 2019 on-year, slowing from 10.9 percent in Jan-June. 

The July data suggests that demand had weakened at home and abroad. The United States had sharply raised tariffs on a large share of its Chinese imports in May.

The tariff row is pushing some Chinese manufacturers to move capacity to neighboring countries and rebuild supply chains outside of China.

Analysts have said that Beijing will need to deliver more stimulus to prevent a deeper downturn and help stabilize growth.

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