China Slowdown Deepens
China’s industrial-output, investment and retail-sales growth unexpectedly slowed, suggesting the government’s efforts to counter an economic slowdown have yet to gain traction.
Factory production rose 8.7 percent in April from a year earlier, the National Bureau of Statistics said today in Beijing, compared with the 8.9 percent median estimate of analysts surveyed by Bloomberg News. Fixed-asset investment increased 17.3 percent in the first four months of the year, and retail sales advanced 11.9 percent in April.
The figures signal risks are increasing that China will miss the year’s expansion goal of about 7.5 percent, testing policy makers’ reluctance to step up monetary easing after outlining measures including tax breaks and spending on railways and housing. Leaders are trying to rein in a credit boom and curb pollution, and President Xi Jinping said last week that the nation needs to adapt to a “new normal” in the pace of growth.
“The relatively tight monetary policy obviously does not correlate with the basic tone of stabilizing growth, so economic growth will stay weak,” Everbright Securities Co. analysts led by Chief Economist Xu Gao in Beijing said in a note before the data. There is a “high probability” of an across-the-board cut in banks’ reserve-requirement ratio, Xu wrote.
Factory-production growth compared with an 8.8 percent increase in March. The advance in retail sales compared with the 12.2 percent median projection of analysts surveyed by Bloomberg and 12.2 percent in March.
The median estimate for January-to-April expansion in fixed-asset investment excluding rural households was 17.7 percent, after a 17.6 percent rise in the first three months of this year.
Source: bloomberg
