Data released by China’s National Bureau of Statistics on Thursday point to a slowdown in a range of economic indicators for the month of May, with retail sales, fixed-asset investment and industrial output all falling short of estimates.
Retail sales grew at the slowest pace in 15 years in May, at 8.5% year-on-year (y/y). Growth in fixed-asset investment, a category that notably includes infrastructure spending, slowed to 6.1% y/y for the five months up to May from 7% during the first four months.
Government infrastructure investment on public transport and road networks grew at 9.4% y/y for the first five months of the year, slowing from 12.4% in the January-April period and likely reflecting Beijing’s strict tightening of financing channels for local governments as part of its wider deleveraging drive.
Many analysts have been anticipating a widespread slowdown in H2 of this year as Beijing’s attempts to rein in China’s systemic debt problem finally take its toll on the wider economy.
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