China’s industrial output and retail sales data for March disappointed market expectations, with industrial output growing by 4.5% year-on-year, lower than the anticipated 6% expansion. The manufacturing industry saw a growth of 5.1%, while the mining industry only grew by 0.2%. On the other hand, retail sales, a key metric for gauging consumption, increased by 3.1% year-on-year, falling short of the expected 4.6% growth rate.
Despite the weaker industrial output and retail sales figures, China’s economy managed to exceed expectations in the first quarter, growing by 5.3% year-on-year. This growth outpaced the 4.6% increase projected by economists polled by Reuters. Data from China’s National Bureau of Statistics revealed that the country’s GDP for the January to March period was higher than the previous quarter’s growth rate of 5.2%. The government of China has set a growth target of around 5% for 2024, indicating a positive outlook for the nation’s economic performance.
On a different note, the Japanese yen hit its weakest level since June 1990, breaching the 154 mark against the U.S. dollar. The significant depreciation of the yen is attributed to the Bank of Japan’s decision to raise interest rates and the uncertainty surrounding potential interventions by Japanese authorities to stabilize the currency. Furthermore, Market expectations for increased price swings in the near future were highlighted as the VIX index closed at its highest level since October 2023, underscoring a heightened sense of investor skittishness in the financial markets.