Chinese economy
China’s growth rate is now slowing down. In August, both industrial production and retail sales could not perform as expected. According to the National Bureau of Statistics (NBS), industrial production increased by 5.2% in August, compared to 5.7% in July. The market expectations were also 5.7%, so this number was disappointing. This is the slowest growth since August of last year. This year the fastest heat and the longest monsoon in China also became a challenge for the manufacturing sector.
Reduction in consumer spending
Retail sales figures were also not very special. It rose 3.4% in August, less than 3.7% of July and lagged behind experts’ expectations of 3.9%. The major reason for the decline in consumer spending is being said to be the slowdown of the property sector and the lethargy of the job market. Constant fall in property prices and lack of employment opportunities have affected both people’s ability and desire to spend. Apart from this, the trust of traders has also decreased, which is slowing down the economic growth. Property investment decreased by 12.9% compared to last year between January and August, while the sales of new homes have also fallen by 4.7%.
Economic risk intact
The Chinese government has expressed vigilance about the situation. Officials of the National Bureau of Statistics have admitted that the economy is still stable, but many uncertain and unstable factors exist. According to the South China Morning Post report, spokesperson Fu Linghui clarified that there are many risks and challenges in the current economic environment. He warned the policy makers that it is necessary to implement macroeconomic policies firmly. Also, keeping jobs, business, market and consumer expectations stable should be a priority.
Unemployment rate also increased
According to government data, the urban unemployment rate in August increased to 5.3%, which has increased from 5.2% in July. This indicates that employment opportunities are still limited. The status of the property sector also remains worrying, where the prices of new houses have fallen by 0.3% every month and 2.5% year-on-year. The decline in investment and the decrease in sales shows the weakness of the sector, which is affecting the entire economic structure.