China's retail sales contract far more than expected, industrial output disappoints
Business
Retail sales fell by 5.9pc in November from a year ago, the National Bureau of Statistics said.
BEIJING (CNBC) - China reported economic data Thursday that missed expectations across the board during a month in which widespread Covid controls weighed on growth.
Retail sales fell by 5.9% in November from a year ago, the National Bureau of Statistics said.
That’s worse than expectations for a decline of 3.7%, according to analysts polled by Reuters, and a greater drop than the 0.5% year-on-year decline in October.
Industrial production grew by 2.2% in November from a year ago, missing Reuters’ forecast for a 3.6% increase. The reported pace was also slower than the 5% increase in October.
Fixed asset investment for the year through November slowed to 5.3% year-on-year growth, missing Reuters’ expectations for a 5.6% increase. The official print was also down from 5.8% growth in the first 10 months of the year.
Investment in infrastructure picked up pace in November from October on a year-to-date basis, while that in manufacturing slowed slightly. Investment in real estate fell at a sharper pace amid the industry’s ongoing slump.
The unemployment rate in cities ticked up to 5.7% in November. The jobless rate for young people ages 16 to 24 remained a far higher 17.1%.
The decline in retail sales brought the year-to-date total down by 0.1% from the first 11 months of last year.
Food and medicine were the only sub-categories that saw sales growth in November from a year ago, according to the statistics bureau. Clothing and shoes saw sales plunge by 15.6%.
Online sales of physical goods rose by just 4% year-on-year in November, down sharply from the prior month, according to CNBC calculations of data accessed through Wind Information.
Sweeping Covid changes
In the last two weeks, China has significantly peeled back a host of Covid-related restrictions that had hampered domestic travel and business activity. Authorities have emphasized vaccinations for elderly people, and encouraged Covid patients to recover at home.
Anecdotally, at least in Beijing, a significant share of the population has since fallen sick, if not tested positive for Covid, amid below-freezing weather.
A day before the data release, China’s National Bureau of Statistics canceled its in-person press conference set for Thursday without explanation.
As China moves toward reopening, analysts expect a surge in infections will initially weigh on growth before the economy can rebound.
The country also faces headwinds from declining global demand.
In November, exports fell by a disappointing 8.7% from a year ago. Imports dropped by 10.6% as domestic demand remained sluggish.
