China's factory output, retail sales miss expectations in May | The Business Standard
Skip to main content
  • Home
  • Economy
    • Aviation
    • Banking
    • Bazaar
    • Budget
    • Industry
    • NBR
    • RMG
    • Corporates
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
    • Book Review
    • Brands
    • Earth
    • Explorer
    • Food
    • Habitat
    • In Focus
    • Luxury
    • Mode
    • Panorama
    • Pursuit
    • Wheels
  • Epaper
    • GOVT. Ad
  • More
    • Subscribe
    • Multimedia
    • TBS Graduates
    • Thoughts
    • Splash
    • Bangladesh
    • Supplement
    • Infograph
    • Archive
    • COVID-19
    • Long Read
    • Interviews
    • Offbeat
    • Tech
    • Magazine
  • বাংলা
The Business Standard

Sunday
December 10, 2023

Sign In
Subscribe
  • Home
  • Economy
    • Aviation
    • Banking
    • Bazaar
    • Budget
    • Industry
    • NBR
    • RMG
    • Corporates
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
    • Book Review
    • Brands
    • Earth
    • Explorer
    • Food
    • Habitat
    • In Focus
    • Luxury
    • Mode
    • Panorama
    • Pursuit
    • Wheels
  • Epaper
    • GOVT. Ad
  • More
    • Subscribe
    • Multimedia
    • TBS Graduates
    • Thoughts
    • Splash
    • Bangladesh
    • Supplement
    • Infograph
    • Archive
    • COVID-19
    • Long Read
    • Interviews
    • Offbeat
    • Tech
    • Magazine
  • বাংলা
SUNDAY, DECEMBER 10, 2023
China's factory output, retail sales miss expectations in May

China

Reuters
16 June, 2021, 04:55 pm
Last modified: 16 June, 2021, 04:58 pm

Related News

  • China’s consumer price drop worsens, fueling deflation fears
  • China issues action plan to improve air
  • China's push to loosen Mao-era residence rules runs into hurdles
  • China launches world's first fourth-generation nuclear reactor
  • Italy withdraws from China's Belt and Road project

China's factory output, retail sales miss expectations in May

Retail sales and investment growth also came in below market expectations, but analysts say underlying activity still looks quite solid, noting headline readings remain highly distorted by comparisons to the pandemic plunge early last year

Reuters
16 June, 2021, 04:55 pm
Last modified: 16 June, 2021, 04:58 pm
People walk along Nanjing Pedestrian Road, a main shopping area, in Shanghai, China May 5, 2021. REUTERS/Aly Song/File Photo
People walk along Nanjing Pedestrian Road, a main shopping area, in Shanghai, China May 5, 2021. REUTERS/Aly Song/File Photo

Growth in China's factory output slowed for a third straight month in May, likely weighed down by disruptions caused by Covid-19 outbreaks in the country's southern export powerhouse of Guangdong.

Retail sales and investment growth also came in below market expectations, but analysts say underlying activity still looks quite solid, noting headline readings remain highly distorted by comparisons to the pandemic plunge early last year.

The Chinese economy has largely shaken off the gloom from the coronavirus slump, but officials warn its recovery remains uneven amid challenges including soft domestic demand, rising raw material prices and global supply chain disruptions.

The Business Standard Google News Keep updated, follow The Business Standard's Google news channel

China's rapid recovery last year and a US rebound this year have sharply boosted Asia's export-reliant economies -- Japan posted its strongest export growth in 41 years on Wednesday -- but resurgent Covid infections and lockdowns are holding back broader-based recoveries.

Chinese industrial production rose 8.8% in May from a year ago, slower than the 9.8% uptick in April, National Bureau of Statistics data showed on Wednesday, missing a 9.0% on-year rise forecast by analysts from a Reuters poll.

In particular, the output of auto vehicles fell 4% from a year earlier, compared with an increase of 6.8% in April, crimped by a global chip shortage.

"This is a normal cyclical slowdown after an economic recovery. In a nutshell, we can see the economic rebound is peaking," said Hao Zhou, senior EM economist Asia, Commerzbank.

"The extent of the slowdown in the second half is key. So far, it's still normal and there's still room for the fiscal policy to play a part later in the year."

Most analysts had expected some moderation in May output due to softer export orders, higher input costs for factories and tighter environmental restrictions on heavy industry.

Outbreaks of Covid-19 in the Pearl River Delta since late May also have brought some key ports to a standstill, economists at Nomura said in a note to clients, though it believes the current spate of infections can be contained in a relatively short period of time.

Fu Linghui, an NBS official, said external risks also remain, such as still rising global Covid-19 infections, an uneven recovery in the world economy and spill-over effects from large stimulus programmes from some countries.

Bright spots

Retail sales rose 12.4% year-on-year in May, weaker than 13.6% growth expected by analysts and down from the 17.7% jump seen in April.

Chinese consumer and business confidence has been picking up thanks to pent-up demand and quickening vaccine rollouts, which are also reviving domestic tourism.

Two-year average growth for retail sales stood at 4.5% in May, faster than the 4.3% in April, in a sign that sales are gradually rebounding, Fu from NBS told reporters.

Fixed asset investment increased 15.4% in the first five months from the same period a year earlier, versus a forecast 16.9% rise, slowing from January-April's 19.9% increase.

Notably, two-year average growth in manufacturing investment turned positive in May.

"What is gratifying is some weak indicators such as consumption and manufacturing investments are showing some improvement," Li Huiyong, deputy general manager at Hwabao WP Fund Management Co., adding that he expects the trend to continue.

China's unemployment rate also continued to drop. Nationwide urban jobless rate fell to 5.0% in May, the lowest since May 2019, from 5.1% in April.

On a month-on-month basis, Capital Economics estimated industrial output growth was unchanged at 0.5%, the pace of investment spending eased slightly and retail sales picked up.

However, Reuters calculations showed real estate investment

in May rose at its slowest pace this year as more smaller towns joined bigger cities in trying to curb red-hot housing prices. New construction starts fell for a second month.

Mixed bag?

Earlier data for May painted a somewhat mixed picture, with export growth easing but imports picking up, fuelled by surging demand and prices for raw materials.

Surging commodities prices pushed China's producer inflation to its highest level in over 12 years, squeezing profit margins for mid- and downstream firms.

Bank lending unexpectedly rose but broader credit growth continued to slow, a trend analysts said could start to weigh on activity in the second half of the year.

Top News / World+Biz / Global Economy

China

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • Two-thirds of LPG sellers hold on to bulk importers to stay afloat in dollar crisis
    Two-thirds of LPG sellers hold on to bulk importers to stay afloat in dollar crisis
  • Adverse impact of geopolitics taking toll on Bangladesh's economy: FBCCI president
    Adverse impact of geopolitics taking toll on Bangladesh's economy: FBCCI president
  • Bangladesh Securities and Exchange Commission (BSEC) Chairman Prof Shibli Rubayat-Ul-Islam. TBS Sketch
    Floor price to remain until election: BSEC chairman

MOST VIEWED

  • Buyer's rep removes sanction clause from RMG LC
    Buyer's rep removes sanction clause from RMG LC
  • Photo: Collected
    Dhaka expressway construction crane hits train; rail link with capital snapped
  • Infographic: TBS
    Automatic fuel oil pricing from March in Bangladesh
  • The company signed an agreement to this effect with BEPZA at BEPZA Complex, Dhaka on 7 December. Photo: Courtesy
    Chinese company to set up pharma ingredients factory in Bepza EZ
  • Infograph: TBS
    RMG exports to US fall 24.75% in Jan-Oct
  • One report says the suspects were stripped to ensure they were not carrying weapons - EMANUEL FABIAN/X/TWITTER
    Palestinians detained by Israel in Gaza blindfolded, stripped to underwear

Related News

  • China’s consumer price drop worsens, fueling deflation fears
  • China issues action plan to improve air
  • China's push to loosen Mao-era residence rules runs into hurdles
  • China launches world's first fourth-generation nuclear reactor
  • Italy withdraws from China's Belt and Road project

Features

Say hello to my little friend: Scarface turns 40

Say hello to my little friend: Scarface turns 40

4h | Features
Tuhin Bin Salam has been at the helm of the business since his father died in 2017. Photo: Nayem Ali

60-year legacy: A chronicle of Salam Stamp Centre

15h | Panorama
Bangladesh now has 19 GI-certified products. What changed?

Bangladesh now has 19 GI-certified products. What changed?

1d | Panorama
Illustration: TBS

How financial institutions can help transition to net zero

1d | Panorama

More Videos from TBS

Cricket icon and ‘Tied Test’ hero Joe Solomon dies at 93

Cricket icon and ‘Tied Test’ hero Joe Solomon dies at 93

2h | TBS SPORTS
Onion prices skyrocketed due to India's export ban

Onion prices skyrocketed due to India's export ban

3h | TBS Today
Most capped footballers in professional football

Most capped footballers in professional football

4h | TBS SPORTS
How to overcome dollar crisis

How to overcome dollar crisis

5h | TBS Round Table
EMAIL US
[email protected]
FOLLOW US
WHATSAPP
+880 1847416158
The Business Standard
  • About Us
  • Contact us
  • Sitemap
  • Privacy Policy
  • Comment Policy
Copyright © 2023
The Business Standard All rights reserved
Technical Partner: RSI Lab

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - [email protected]

For advertisement- [email protected]