China’s Economy Deepens Slump in August as Key Indicators Miss Forecasts
China’s Economy Deepens Slump in August as Key Indicators Miss Forecasts
China’s economic slowdown intensified last month, with a series of crucial indicators for August falling short of analyst expectations. Persistent weak domestic demand and Beijing’s efforts to curb industrial overcapacity are cited as primary factors in the deepening slump.
Official data released on Monday by the National Bureau of Statistics revealed that retail sales in August rose by only 3.4% year-on-year. This figure missed Reuters’ analyst estimates of 3.9% growth and marked a further deceleration from July’s 3.7% increase, signaling ongoing consumer caution.
Industrial output growth also decelerated significantly, reaching 5.2% in August, down from July’s 5.7% jump and representing its weakest performance since August 2024, according to LSEG data. Economists had anticipated output to remain stable from the previous month.
Fixed-asset investment, reported on a year-to-date basis, expanded by a mere 0.5%. This represents a sharp decline from the 1.6% expansion observed in the January to July period and fell considerably below economists’ forecasts of 1.4% growth. A significant contributor to this downturn was the worsening contraction in real estate investment, which plummeted 12.9% in the first eight months of the year.
While state-owned enterprises have largely sustained fixed-asset investments, with increases in manufacturing (5.1%) and utilities (18.8%), investments from the private sector continued to contract, noted Yuhan Zhang, principal economist at The Conference Board’s China Center. Zhang further highlighted that overall manufacturing investment has seen “modest and uneven growth,” predominantly supported by policy-driven state investments in infrastructure, high-tech sectors, and industrial upgrades, while the critical real estate market remains subdued.
Disclaimer: This content is aggregated from public sources online. Please verify information independently. If you believe your rights have been infringed, contact us for removal.