China's industrial output growth slows in April, retail sales miss forecasts

BEIJING (Reuters) – China’s factory output growth slowed in April from the jump seen in the previous month while retail sales missed analyst expectations, indicating more pressure on the recovery in consumption.

Industrial production grew 9.8% in April from a year ago, slower than the 14.1% surge in March, National Bureau of Statistics data showed on Monday, but matching a consensus forecast by analysts from a Reuters poll.

Aluminium production in April rose 12.4% from March to a record monthly volume.

China’s economy showed a steady improvement in April, but new problems are also emerging, said Fu Linghui, an NBS spokesman, at a news briefing in Beijing on Monday.

“The foundations for the domestic economic recovery are not yet secure,” he said.

China’s surging growth figures in the first months of the year were boosted by the low comparison with an economy paralysed by COVID-19 in the same period a year before.

Retail sales rose 17.7% year-on-year in April, much weaker than a 24.9% uptick expected by analysts and down from the jump of 34.2% seen in March.

Consumption should maintain a steady recovery, said Fu.

Growth in sales of home appliances dropped particularly sharply in April from the month before, falling from 38.9% growth on year in March to 6.1%, NBS data showed.

Fixed asset investment increased 19.9% in the first four months from the same period a year earlier, versus a forecast 19.0% rise, slowing from January-March’s 25.6% increase.

Private-sector fixed-asset investment, which makes up around 60% of total investment, rose 21.0% in January-April, compared with a 26.0% jump for the first three months.

Asian share markets were mixed on Monday after the data was released.

A top decision-making body of the ruling Communist Party said last month the country will encourage manufacturing and private investment to recover as quickly as possible.

The Politburo meeting chaired by President Xi Jinping also warned China’s economic recovery remained uneven and that its foundation was not yet solid.

Exports unexpectedly accelerated in April and import growth hit a decade high, thanks to strong demand for Chinese goods amid a brisk U.S. economic recovery and stalled factory production in other countries.

However, April also saw factory activity slow as supply bottlenecks and rising costs weighed on production.

China’s gross domestic product (GDP) expanded by a record 18.3% in the first quarter and many economists expect growth will exceed 8% this year.

Some warn that continuing global supply chain disruptions and higher comparison bases will sap momentum in coming quarters.

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