As China battles with inflation woes, July’s economic data implied gloomy futures ahead.
According to the National Bureau of Statistics, retail sales rose by 2.5 percent to 3,676 billion renminbi, or $506.45 billion, in July, down from 3.1 percent in June, missing expectations of a 4.5 percent increase, according to a group of analysts polled by Reuters.
According to the NBS, the slowdown was mainly due to a contraction in car sales.
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“Now the idea of a consumer-spending-led recovery is looking very vulnerable,” said ING’s Robert Carnell.
As macroeconomic concerns mount, China‘s Central Bank unexpectedly lowered a set of key interest rates on Tuesday.
Growth for apparel goods and cosmetics continued to lose steam in July. Retail sales of apparel goods inched up 2.3 percent to 96.1 billion renminbi, or $13.3 billion, down from June’s 6.9 percent growth.
Retail sales for cosmetics slid 4.1 percent year-over-year to 24.7 billion renminbi, or $3.4 billion.
For the first seven months of this year, online retail sales jumped 12.5 percent to 8,309.7 billion renminbi, or around $1.1 billion.
The NBS said it will begin releasing monthly service consumption data in August. From January to July, service-related retail sales, including tourism and catering, surged 20.3 percent year-over-year.
Data for industrial output and fixed-asset investment, which rose 3.7 percent and 3.4 percent year-over-year, respectively, also missed analyst expectations.
China’s property sector continued to struggle, with investment data falling 8.5 percent in July.
Urban unemployment rate for July increased slightly from 5.2 percent to 5.3 percent. The NBS did not release youth unemployment data for July and said it would suspend the publication of the country’s youth jobless data, citing a need to update its statistical approach according to socio-economic developments.
The unemployment rate for China’s youth, or aged 16 to 24, hit a record high of 21 percent in June.