China April economic activity data disappoints, hiking recovery doubts

Sat May 14, 2016 4:43am EDT
 
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By Pete Sweeney and Jessica Macy Yu

SHANGHAI/BEIJING (Reuters) - China's investment, factory output and retail sales all grew more slowly than expected in April, adding to doubts about whether the world's second-largest economy is stabilizing.

Growth in factory output cooled to 6 percent in April, the National Bureau of Statistics (NBS) said on Saturday, disappointing analysts who expected it to rise 6.5 percent on an annual basis after an increase of 6.8 percent the prior month.

China's fixed-asset investment growth eased to 10.5 percent year-on-year in the January-April period, missing market expectations of 10.9 percent, and down from the first quarter's 10.7 percent.

Fixed investment by private firms continued to slow, indicating private businesses remain skeptical of economic prospects. Investment by private firms rose 5.2 percent year-on-year in January-April, down from 5.7 percent growth in the first quarter.

"It appears that all the engines suddenly lost momentum, and growth outlook has turned soft as well," Zhou Hao, economist at Commerzbank in Singapore, said in a research note.

"At the end of the day, we have acknowledge that China is still struggling."

Reuters reported on Saturday that China's banking regulator has sent an urgent notice to banks telling them to clear bottlenecks holding back lending to private firms.

In its data announcement, the statistics bureau said "Because the total amount of private investment is relatively large, its continued slowdown could restrain stable growth, and requires a high degree of attention."   Continued...

 
A woman stands on an overhead bridge near the construction site of  "Kaisa Plaza", then named "Changan No. 8" (L), on a hazy day in Beijing's central business district in this July 28, 2012 file picture. REUTERS/Jason Lee/Files