China’s factory output in April was better than expected despite the tough trade war with the United States.
This information was revealed in official statistics released by Beijing on Monday.
According to China’s National Bureau of Statistics (NBS), industrial production in April grew 6.1 percent year-on-year, compared to a Bloomberg forecast of 5.7 percent. However, this is lower than the 7.7 percent increase in March.
The statistics said, “The national economy continued to grow steadily in April despite the pressure.” However, the bureau admitted, “external pressures and various internal complications have become challenges for the Chinese economy.”
Recently, China and the United States reduced tariffs imposed on each other for 90 days, which brought some relief to the global economy.
However, the slowdown in consumer spending has put more pressure on the Chinese economy. This puts the government’s target of 5 percent growth at risk.
Retail sales rose 5.1 percent year-on-year in April, down from 5.8 percent in Bloomberg’s forecast. The rate was 5.9 percent in March, suggesting that domestic demand has eased somewhat.
At the same time, China’s unemployment rate fell to 5.1 percent in April from 5.2 percent in March, a somewhat positive sign.
Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said, “Even after the US tariff hike, China’s exports were largely stable. Now that the tariffs have been reduced, it is expected that exports will do better and the economy will be relatively stable in the second quarter.”
However, the long-term slowdown in the once-vigorous housing sector remains a major obstacle to the economy.
The long-term slowdown in the once-vigorous housing sector is further complicating China’s economic woes. The sector was once one of the main drivers of the country’s economy.
According to statistics, the price of new residential flats fell in 67 of China’s 70 cities in April, indicating caution and spending cuts among ordinary people.
Source: Reuters.