China Industrial Output Growth Tops Expectations; Retail Sales Disappoint

(RTTNews) - China's industrial production increased more than expected in April despite trade tariff hikes and the unemployment rate dropped marginally but growth in retail sales fell short of expectations signalling weaker domestic demand, official data revealed on Monday.

Industrial output logged an annual growth of 6.1 percent in April after rising 7.7 percent in March, the National Bureau of Statistics reported. However, this was stronger than the expected increase of 5.7 percent.

Retail sales advanced 5.1 percent from a year ago in April. Economists had forecast sales to advance 6.0 percent, following March's 5.9 percent increase. During January to April period, fixed asset investment climbed at a slower pace of 4 percent from the previous year. Investment had climbed 4.2 percent in the January to March period and it was forecast to rise 4.4 percent.

Meanwhile, property investment declined 10.3 percent from the previous year. The urban jobless rate came in at 5.1 percent in April, down from 5.2 percent in the previous month.

ING economist Lynn Song said April data was a bit of a mixed bag, showing an overall moderation of growth as the tariff escalations shook global markets.

The economist noted that slowdowns in fixed asset investment and retail sales and a bigger downturn in property prices, reflect that China's private sector and households may be erring on the side of caution amid the recent volatility.

"While the trade war ceasefire is no doubt welcome news for many, the uncertain environment remains," said Song.

Beijing has unveiled a slew of stimulus measures to boost domestic demand and counter the downturn caused by the external environment.

Earlier this month, the People's Bank of China reduced its benchmark interest rate and reserve requirement ratio and also announced measures to support economy hit by trade tariffs.