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Retail sales were up 4% in January and February compared to last
year, and industrial production rose 5.9%, the National Bureau
of Statistics reported. The stronger than expected data helped
buoy stock markets in Asia.
A spokesperson for the bureau said the economy is moving in the
right direction but cautioned that challenges remain at home and
abroad. U.S. President Donald Trump has put a 20% tariff on
Chinese products, which could set back an economy with a high
dependence on exports.
“The external environment has become more complex and grim,
domestic effective demand is insufficient, some companies are
facing difficulties in production and operation, and the
foundation for the continuous recovery of the economy is still
unstable,” Fu Linghui said at a news conference.
A long-running real estate crisis is weighing on the overall
economy, depressing consumer confidence and spending. Real
estate investment fell 9.8% in the first two months of the year,
the statistics bureau said.
The good news is that real estate price declines have slowed,
though they have yet to bottom out. Prices for both new and
existing homes fell in January and February, but at a much
slower pace than most of last year.
ING bank said it expects real estate prices to stop falling this
year but they likely will not rebound quickly.
“February’s data showed that it would be wise for officials not
to take their foot off the pedal in terms of policy support,”
Lynn Song, the chief Greater China economist at ING, wrote in a
report.
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Associated Press researcher Yu Bing contributed to this report.
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