BEIJING (REUTERS) – China’s factory output and retail sales both rose more slowly than expected in July from a year ago, data showed on Monday (Aug 16), amid signs of increasing pressure on China’s economy as export growth cooled and new Covid-19 outbreaks disrupted business.<\/p>\n
Industrial production in the world’s second-largest economy increased 6.4 per cent year on year in July, against expectations for 7.8 per cent growth and after rising 8.3 per cent in June.<\/p>\n
China’s economy has rebounded to its pre-pandemic growth levels, but the expansion appears to be losing steam as businesses have grappled with higher costs and supply bottlenecks while new Covid-19 infections in July prompted some local authorities to lock down and temporarily suspend business operations.<\/p>\n
Data earlier this month also showed export growth, which has been a key driver of China’s impressive rebound from the Covid-19 slump in early 2020, unexpectedly slowed last month.<\/p>\n
Consumption remained weak with retail sales rising 8.5 per cent year on year in July. Analysts had expected retail sales to increase 11.5 per cent after a 12.1 per cent uptick in June.<\/p>\n
China has tightened social restrictions to fight its latest Covid-19 outbreak in several cities, hitting the services sector, especially travel and hospitality in the country.<\/p>\n
Fixed asset investment grew 10.3 per cent in January-July from the same period a year ago, compared with an 11.3 per cent rise tipped by a Reuters poll and a 12.6 per cent increase in January-June.<\/p>\n
Private sector fixed-asset investment, which accounts for 60 per cent of total investment, grew 13.4 per cent in the first seven months of the year, compared with a 15.4 per cent gain in the period from January to June.<\/p>\n
Property investment, a crucial growth driver of China’s recovery from Covid-19 disruptions, grew 12.7 per cent in January to July, versus 15 per cent rise in the first half of this year.<\/p>\n
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