China's recovery sputters as factory and retail data disappoints




  • In Business
  • 2020-08-14 08:20:15Z
  • By The Telegraph
China\
China\'s recovery sputters as factory and retail data disappoints  

A weaker than expected rise in Chinese factory output and a drop in retail sales suggested the country's post-pandemic recovery is struggling to gather pace.

Despite a 7.2pc rebound in Chinese exports last month compared to last year, industrial production added only 4.8pc - on a par with the month before, according to official data.

Nominal retail sales fell 1.1pc, indicating that domestic demand remains tepid, partly due to flooding in the south of the country since June.

The National Bureau of Statistics said China created 6.7m jobs, nearly 2m fewer than would normally be expected.

Investment in factories and construction was more robust, falling 1.6pc from January to July, compared to a 3.1pc contraction in the first half of the year.

An official said the trends showed a "steady recovery".

Tommy Wu, of Oxford Economics, said he expected investment to lead the economic recovery, which would continue in the second half of the year.

"While household consumption has been the laggard, we expect it to gather pace along with a gradual improvement in the labour market in the second half of the year.

"But the road ahead appears bumpy, as new export orders remain weak and the recovery path will be uneven across economies."

Chinese and US officials are expected to hold online talks on Saturday about the progress of their Phase One trade deal signed in January.

Relations between the world's two largest economies have soured over the origins of the virus, China's crackdown on Hong Kong and the Trump administration's order to ban the Chinese internet giants TikTok and WeChat from operating in the US.

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