Data released by the National Bureau of Statistics showed industrial production rose 5.6% in April, from a year earlier, after accelerating 3.9% in March. But it is well below expectations of a 10.9% increase in a Reuters poll of analysts, despite representing the fastest rate of growth since September 2022.
Retail sales jumped 18.4% from 10.6% in March, marking its biggest increase since March 2021. Analysts had expected retail sales to rise 21%.
Capital investment also rose 4.7% against expectations of 5.5%. The reading for the previous month (March) was up 5.1%.
Other data released last week showed imports contracted in April and bank lending fell more than expected, pointing to weak domestic demand, increasing pressure on policymakers to support the economic recovery as global growth is weakening.
China’s central bank kept interest rates unchanged on Monday, as expected, but markets are betting on further monetary easing in the coming months.
“China is in a recovery phase, compared to last year, the numbers released today are positive as we have just seen, but is the recovery good enough for the market, is the recovery good enough to meet investors’ expectations – that’s the big question here,” said Bank of America In China strategist Winnie Wu.
“The published data is not good enough to meet investors’ expectations – that’s the problem,” Wu said, adding that the momentum in pent-up Chinese demand appeared to be fading.
Chinese stocks have pared most of the gains seen this year, with the Shenzhen Composite Index down 4.67% year-on-year and up just 1.48% year-to-date, down 9.5% from its peak in early February.
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