On Friday, China released retail sales and industrial production figures for September that surpassed expectations. According to the National Bureau of Statistics, retail sales increased by 3.2% compared to the same period last year, exceeding analysts’ predictions of 2.5% growth from an LSEG poll. This rate marks an acceleration from the previous month’s growth of 2.1%.
In addition, industrial production in September saw a 5.4% rise from the prior year, surpassing the 4.5% growth anticipated by analysts. From January to September, fixed asset investment increased by 3.4% year-on-year.
China reported an urban unemployment rate of 5.1% in September, representing a 0.2 percentage point decrease from the previous month. Although these figures suggest some positive trends, Gary Ng, a senior economist at Natixis, indicated that it remains uncertain if China’s economy is fully recovering. He observed that the year-to-date retail sales reflect a “cautious sentiment among consumers.”
Retail sales for the period from January to September grew by 3.35%, maintaining a pace similar to the 3.36% growth recorded from January through August. These figures follow several recent announcements from Chinese authorities, as Beijing aims to stimulate consumption and support its struggling real estate sector.
On the same day, China also disclosed slightly better-than-expected gross domestic product data. Investors have been anticipating stimulus measures as the world’s second-largest economy faces challenges in recovering from Covid-19 lockdowns. Market conditions have been unstable as investors evaluate the announcements and await further details on their implementation.
Ng emphasized the importance of sufficient interest rate cuts and fiscal policies in facilitating an economic rebound and boosting confidence.