China economy shows new signs of weakness with soft factory data

This article is more than 12 months old

Aug 15, 2019 06:00 am

BEIJING: China's economy showed more signs of strain last month with output at its factories falling to its lowest level in 17 years, while investment and retail sales also slowed, official data showed.

The figures are the latest to highlight how the world's second largest economy is being battered by an escalating trade war with the US, weak global demand and deteriorating conditions at home.

Industrial output increased 4.8 per cent on-year last month, down from 6.3 per cent in June and marking the weakest pace since 2002. It was also well below the 6 per cent forecast by economists in a Bloomberg News survey.

The data also suggested China's consumers were showing signs of increasing thriftiness. Retail sales - which have long been a bright spot for the economy - slowed to a 7.6 per cent rise last month, sharply down from 9.8 per cent in June.

Ms Liu Aihua, a spokesman for the National Bureau of Statistics which released the data yesterday, attributed the weaker July numbers to a reversal in car sales as dealers unloaded thousands of vehicles at knockdown prices in June to beat tougher incoming emissions standards.

After deducting the car sales figures, "total retail sales of consumer goods in July increased by 8.8 per cent year-on-year, which was basically the same as last month", said Ms Liu.