The number of COVID cases has soared in China’s capital, Beijing, with many communities recently locked down or under stricter health surveillance as the country maintains a no-covid policy.
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BEIJING — Three indicators of China’s economy in October came in below expectations and represented a slowdown from September, according to data released by China’s National Bureau of Statistics on Tuesday.
The data showed retail sales fell 0.5% in October from a year ago – the first decline since May – and industrial production grew by 5%.
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Analysts polled by Reuters had forecast retail sales would slow to 1% year-on-year in October, and industrial production would also slow to 5.2%.
Investment in fixed assets for the first 10 months of the year grew 5.8%, slightly below expectations to maintain the same pace as September, with a 5.9% year-on-year increase, according to a Reuters poll.
Real estate investment fell further in October year-over-year, while manufacturing investment slowed slightly from September. Infrastructure investment rose moderately, to 8.7% year-on-year for 2022 as of October.
The urban unemployment rate remained unchanged from September at 5.5% in October. The percentage of young people between the ages of 16 and 24 is also unchanged, at 17.9%.
A drop in retail sales in October brought the year-to-date number down to just 0.6%. Home appliances, restaurants, and apparel saw some of the biggest declines in sales last month compared to a year ago.
Car sales maintained a growth of 3.9%. Online sales of physical goods rose 22% year-over-year in October, making up more than a quarter of retail sales overall, CNBC calculates the data.
China’s economic recovery has slowed, said Fu Lingwei, a spokesperson for the National Bureau of Statistics, citing slowing global growth and the domestic outbreak of COVID-19.
He also said that the so-called three pressures on growth have intensified.
Almost a year ago, Beijing warned that the domestic economy was facing a “triple stress” – from shrinking demand, supply shocks and a weak outlook. One of the weakest points was depreciation.
Fu pointed to signs of improvement in the real estate sector, but said the sector was still on a downward trajectory.
Over the past few days, authorities have announced measures to support the ailing real estate market, according to financial media and official notifications.
It is uncertain whether the changes will be sufficient, Larry Hu, chief China economist at Macquarie, said in a report, “but it is clear that policymakers now have the courage to take more decisive action.”
Widespread slowdown in October
Data released prior to Tuesday’s announcement revealed a negative turn in trade and domestic demand last month.
Exports fell in October for the first time since May 2020, while the producer price index fell for the first time in nearly two years. Core CPI, excluding food and energy, showed no change from September with a weak 0.6% year-on-year growth in October.
Hu pointed out that the credit data is disappointing, mainly due to the sluggish real estate market. He noted that household loans in the first 10 months of the year are less than half of what they were a year ago.
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