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April retail sales, industrial production, investment data

Pictured is a BYD factory producing new energy-powered trucks in Huai’an, China, February 21, 2024.

Nuphoto | Nuphoto | Getty Images

BEIJING — China released data Friday showing slowing consumption growth, while industrial activity remained robust.

Retail sales rose 2.3% in April compared to last year, the National Bureau of Statistics said. That’s less than the 3.8% increase forecast by a Reuters poll, and slower than the 3.1% pace reported in March.

Industrial production rose 6.7% in April from a year ago, beating expectations for 5.5% growth. This is also a clear recovery from 4.5% in March.

But investment in fixed assets increased by 4.2% for the first four months of the year, less than the expected increase of 4.6%.

Real estate investment accelerated its rate of decline and fell 9.8% year-on-year for the first four months of 2024.

During this period, investment in infrastructure and manufacturing slowed slightly from the level recorded in March.

The urban unemployment rate in April was 5%. The bureau previously said it would release the age distribution within days of releasing the overall data.

The statistics office said in a statement that April’s figures were affected by the May 1 Labor Day holiday and last year’s high level.

“Key indicators of industry, exports, employment and prices have generally improved, with new driving forces maintaining rapid growth,” the bureau said.

China was also due to launch a six-month, decades-long bond issuance program on Friday to finance strategic projects. Oxford Economics expects that the bulk of the economic impact will not be felt until the first half of next year.

Mixed results so far

Other data released for April point to a mixed growth picture.

Exports rose year-on-year in April, up 1.5% and in line with expectations, while imports rose much more than expected, up 8.4%.

Another sign of stabilization of domestic demand, consumer prices increased slightly last month.

But a measure of factory-level prices continued to fall. New loan data for April fell to levels not seen in at least two decades, largely due to changes in data measurement but also reflecting weak borrowing demand from businesses and households for the future.

The prolonged downturn in the real estate sector has yet to show signs of significant recovery, with many pre-sold apartments still under construction. More cities have eased restrictions on home buying in recent weeks in a bid to boost sales.

Details expected on housing policy

Officials from the Ministry of Housing, the central bank and the financial regulator are due to hold a press conference on Friday afternoon on policies to support housing delivery.

Dan Wang, chief economist at Hang Seng Bank (China), said in an interview late last month that she expected China’s real estate market to stabilize by the end of the year next.

“It actually seems to me that this policy has succeeded, in a very brutal way because it’s happening too quickly, because it has essentially stopped speculation,” she said.

While the housing crisis has taken a particular toll on the wealth of the middle class, it has highlighted that the economy as a whole has been resilient.

“Data quality aside, it appears that the economy is able to compensate for a significant loss in the real estate market with industrial and manufacturing investment,” Wang said. “The way China’s economy is organized and the way its industrial policy has been implemented has shown a certain strength.”

China’s official GDP rose 5.3% in the first quarter from a year ago, better than expectations for a 4.6% increase. The country has set a target of around 5% GDP growth for 2024.

The EU Chamber of Commerce in China told reporters last week that recent economic pressures appear cyclical and that it is more important for foreign companies to see an increase in domestic demand than in industrial investment.

Retail sales rose 6.8% year-on-year during a recent holiday period from April 29 to May 3, according to China’s Ministry of Commerce.

The ministry said retail sales of household appliances increased by 7.9 percent during this period, while those of automobiles increased by 4.8 percent, boosted by domestic trade incentives.

This is breaking news. Please check again for updates.


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