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Investing.com -- China’s industrial production growth slowed in July, as weaker domestic demand and higher cost pressures offset continued support from strong overseas demand for Chinese goods.
Industrial production rose 4.5% year-on-year in July, data released by the National Bureau of Statistics showed on Monday, below expectations for a 5% increase and slowing from 5.3% growth in June.
The slowdown came as China’s manufacturing sector faced a more challenging demand backdrop. The official manufacturing PMI slipped into contraction in July, while domestic consumption remained subdued.
At the same time, robust external demand continued to provide support for Chinese exports, particularly in higher-tech areas, cushioning the impact on industrial output.
Higher costs linked to disruptions in global energy and shipping markets also added to the pressure on producers.
Fixed-asset investment fell 6.7% year-on-year in the January-July period, deepening from a 5.7% decline in January-June and coming in weaker than expectations for a 6.% drop, underscoring continued weakness in capital spending.
Investment has remained under pressure amid a prolonged property-sector downturn, while policymakers have focused on accelerating fiscal spending on already-approved infrastructure projects and making greater use of existing measures to support growth.
Retail sales rose just 0.6% year-on-year in July, falling well short of expectations for 1.5% growth and slowing from 1% in June.
The weak reading reinforced concerns over subdued household demand, with the prolonged property downturn and still-cautious consumers limiting the strength of the domestic recovery.
