China’s Economy Dials Back a Notch as Output and Investment Slow

Bloomberg

Published Jun 14, 2018 12:00

Updated Jun 14, 2018 14:59

China’s Economy Dials Back a Notch as Output and Investment Slow

(Bloomberg) -- China’s economy showed signs of losing steam in May, with an unexpected slowdown in factory output and lackluster investment and consumption.

  • Industrial output rose 6.8 percent in May from a year earlier, versus a projected 7 percent in a Bloomberg survey, which was also the reading in April
  • Retail sales expanded 8.5 percent from a year earlier, versus a forecast 9.6 percent
  • Fixed-asset investment rose 6.1 percent year-on-year in the first five months, compared with an estimated 7 percent
  • Surveyed jobless rate in urban areas fell to 4.8 percent from 4.9 percent in April

With a sharp deceleration in credit growth and the threat of a worsening trade dispute with the U.S., Chinese businesses face an increasingly uncertain outlook. The central bank has tried to support growth by increasing liquidity.

“Going forward, the real economy will be under even higher pressure" as investment continues to slowdown, and relations with the U.S. continue to be tense, Alicia Garcia Herrero, chief Asia-Pacific economist at Natixis SA, wrote in a recent note.

To contact Bloomberg News staff for this story: Xiaoqing Pi in Beijing at xpi1@bloomberg.net

To contact the editors responsible for this story: Jeffrey Black at jblack25@bloomberg.net, James Mayger

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