China Retail Sales Growth Weakens Again in August

China’s retail sales grew last month at their slowest pace since May, official data showed on Tuesday, as the country’s leaders struggle to reverse a persistent slump in spending. The 0.4 percent year-on-year increase in August, released by the National Bureau of Statistics (NBS), marked the second successive slowdown in growth following a 1 percent increase in June. It also missed the 0.8 percent rise predicted in a survey of economists by Bloomberg, though it was better than the 0.6 percent contraction recorded in May.

Beijing has grappled with sluggish domestic spending since the end of the Covid-19 pandemic, with stagnant activity weighing on national growth even as exports boom. Industrial production expanded 5.2 percent in August, the NBS said, up from July’s 4.5 percent and better than Bloomberg’s forecast of 4.8 percent.

China’s economy “operated steadily” in August, the NBS said in a statement, while acknowledging that “adverse external factors are intensifying”. “The domestic imbalance between strong supply and weak demand remains pronounced, some firms face operational difficulties and the foundation for steady economic improvement requires consolidation,” it said. Authorities are pursuing an official growth target this year of between 4.5 and 5 percent, the lowest in decades.

Tuesday’s data also showed fixed-asset investment contracted 7.2 percent year-on-year in August, more than expected.