Weak domestic demand continues to weigh on China's economy in August, with retail sales registering sluggish growth and fixed-asset investment declining further.
Retail sales edged up 0.4% year over year to 3.982 trillion yuan, softer than the 0.6% rise in the previous month and missing the consensus forecast of 0.7% tracked by Investing.com.
The latest retail sales data "highlights weak consumption," according to ING Greater China Chief Economist Lynn Song. Despite China being the largest producer and consumer of electric cars, auto sales dragged growth with an 18.5% fall to 327.9 billion yuan during the month.
Fixed asset investment contracted for the sixth straight month to 7.2% year over year, slowing from the 6.7% contraction recorded in July and missing the consensus forecast of a 7% contraction. The rise in high-tech fixed-asset investment failed to stop the plunge seen in the infrastructure, manufacturing, and real estate sectors.
Property investments fell 19.9% year over year in the January-August period, faster than the 19.2% slide in the seven months through July.
Industrial production grew 5.2% year over year in August, outpacing the 4.5% expansion in July and the consensus forecast of 4.8%. ING's Song said "resilient external demand and China's own tech and industrial upgrading continue to drive growth" in industrial activity.
Lithium-ion battery production surged 57.2%, while high-tech manufacturing and equipment manufacturing jumped 16.7% and 12.1%, respectively.
By sector, manufacturing output grew 6.1%, mining declined 1.4%, and the production and supply of electricity, thermal power, gas, and water climbed 4.9%.
China's surveyed urban unemployment rate rose to 5.3% in August from 5.2% the previous month, wrong-footing analysts polled by Investing.com, who had expected the rate to remain unchanged at 5.2%.
