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China economy

China’s fixed-asset investment growth falls to record low

China investment growth slowed to a record low in August, but industrial output and retail sales both grew at stronger-than-expected rates

PUBLISHED : Friday, 14 September, 2018, 10:30am
UPDATED : Friday, 14 September, 2018, 10:30am

China’s fixed-asset investment growth slowed to 5.3 per cent in the first eight months of the year, below forecasts and hitting a record low, government data showed on Friday.

But industrial output grew by 6.1 per cent in August from a year earlier, while retail sales rose 9.0 per cent, both beating expectations.

Investment growth had been expected to be 5.5 per cent in the first eight months of the year, matching a record low in January-July.

Analysts polled by Reuters had predicted industrial output growth would remain at 6.0 per cent, in line with July.

Private sector fixed-asset investment rose by 8.7 per cent in January-August, compared with an increase of 8.8 per cent in the first seven months, according to official data.

Trade war, higher costs threaten China’s small export businesses

Private investment accounts for about 60 per cent of overall investment in China.

Analysts had expected retail sales to rise 8.8 per cent, unchanged from the growth rate in July.

With US trade duties threatening to ratchet up pressure on China’s already slowing economy, its policymakers have shifted focus in recent months to growth-boosting measures, which range from ramping up infrastructure spending to cutting taxes and fees.

But analysts say such measures will take time to kick in, and are likely only to cushion the blow on businesses if Washington continues to pile on more tariffs.