China industrial output growth slows in October: Govt

Retail sales, a key indicator of consumer spending, increased 11.5 percent in October, the National Bureau of Statistics said, slowing from September`s 11.6 percent gain.

Beijing: Growth in China`s industrial production, which measures output at factories, workshops and mines in the world`s second-largest economy, slipped to 7.7 percent year-on-year in October, the government announced on Thursday.

The figure was down from 8.0 percent in September, and also below market expectations of 8.0 percent.

Retail sales, a key indicator of consumer spending, increased 11.5 percent in October, the National Bureau of Statistics said, slowing from September`s 11.6 percent gain.

And fixed asset investment, a measure of government spending on infrastructure, expanded 15.9 percent on-year in the first 10 months, compared with the gain of 16.1 percent over the first nine months.

The median forecasts in surveys of 11 economists by the Wall Street Journal had been for retail sales to go up 11.6 percent, and fixed asset investment to rise 16.0 percent.

China is a key driver of global expansion, but its growth is slowing.

Nomura economists said the figures came despite further policy easing, suggesting that "headwinds from the property market correction, severe overcapacity in many upstream industries and an overleveraged corporate sector are very strong".

They added: "The efficacy of policy easing may have lessened".
China`s economy expanded 7.3 percent in the third quarter, lower than the 7.5 percent in the previous three months and the slowest since 2009 at the height of the global financial crisis.

On Monday the NBS said that Chinese inflation was unchanged at a near five-year low of 1.6 percent in October, and analysts warned of deflationary risks.

Thursday`s data also comes after mixed readings earlier this month on China`s manufacturing sector.

British bank HSBC`s closely watched final purchasing managers` index (PMI) survey for October picked up to a three-month high of 50.4.

But China`s official PMI announced by the NBS came in at 50.8 last month, lower than the 51.1 recorded in September and the weakest in five months.

The indexes track activity in factories and workshops and are considered key indicators of the health of China`s economy.

China`s leaders say they are satisfied with slowing growth as part of a general rebalancing of the economy to a model in which consumer spending is the main driver, so long as job creation remains sufficient.

Still, authorities this year have deployed a series of pinppoint measures to bolster growth, including targeted cuts in reserve requirements -- the amount of funds banks must put aside -- and a 500 billion yuan ($81.6 billion) injection into the country`s five biggest banks for re-lending.

Falling prices in China`s property sector are a key issue, while some analysts are concerned about the health of the country`s financial system.

New home prices in China declined for a sixth straight month in October, according to a private survey, though the pace of the fall slowed markedly.

Chinese President Xi Jinping acknowledged that the economy faces financial risks in a speech Sunday to a meeting of Asia-Pacific business executives in Beijing, but expressed confidence they are manageable, describing them as "not that scary".

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