China’s industrial production growth slowed unexpectedly and property market saw subdued investment growth in October, while retail sales rose more than expected, providing a mixed picture of the economy.
Industrial production climbed 5.6 percent on a yearly basis in October after increasing 5.7 percent in September, the National Bureau of Statistics reported Wednesday. Economists had forecast it to rise at a slightly faster pace of 5.8 percent.
At the same time, the annual growth in retail sales edged up to 11 percent in October from 10.9 percent in September. This was the fastest growth seen so far this year. This belied expectations for an unchanged pace of growth.
During the January to October period, urban fixed asset investment increased 10.2 percent from the same period of last year, in line with expectations. In the months between January and September, investment had advanced 10.3 percent.
Real estate investment grew only 2 percent in the first ten months of the year compared to 2.6 percent in the period from January to September.
Julian Evans-Pritchard at Capital Economics said the data suggests that activity in industry remains subdued but broadly stable. As the sharp fall in commodity prices late last year enters the base for comparison, headline growth in inflation, trade, investment and retail sales should all receive a boost, the economist said.
Lower inflation and weak economic growth provided the central bank with a suitable situation for monetary policy adjustment.
Inflation eased to 1.3 percent in October from 1.6 percent in September, giving room for the central bank to ease its monetary policy further.
The People’s Bank of China reduced its interest rates six times since last November. The bank last cut its rates by a quarter point in October.
China’s economic growth eased slightly to 6.9 percent in the third quarter, which was below the government’s target of about 7 percent.
Earlier this week, the Organisation for Economic Co-operation and Development upgraded its 2015 growth forecast for China to 6.8 percent from 6.7 percent, while it lowered the outlook for the next year to 6.2 percent from 6.5 percent.
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