New energy vehicles, which include hybrid and battery-powered cars, have seen sales growth in China despite a slowdown in the overall car market. Pictured here is an unnamed new energy vehicle factory in Jiangsu Province on June 13, 2022.
Wan Shanchao | Visual China Group | Getty Images
BEIJING – China released economic data for May, which topped tacit expectations for a month hampered by COVID controls.
Industrial output rose marginally to 0.7% in May from a year earlier, a drop of 0.7% expected, according to analysts polled by Reuters. In April, industrial output unexpectedly fell, down 2.9% year-on-year.
Retail sales in May were down 6.7% from a year earlier. Retail sales were projected to drop 7.1% in May from a year earlier, according to a Reuters poll. Retail sales in April declined by 11.1 per cent from a year ago.
Real estate investment grew 6.2% for the January-May period, topping expectations of a 6% growth.
China’s National Bureau of Statistics said in a statement that the economy “showed a good pace of recovery” in May, “with negative impacts from the COVID-19 pandemic gradually ebbing away and modest improvement in key indicators.”
“However, we should be aware that the international environment is even more complex and dire, and the domestic economy still faces difficulties and challenges to reform,” the bureau said.
China’s exports accelerated in May with a better than a year ago growth of 16.9% in US dollar terms. Imports also grew by 4.1 per cent, higher than expected.
Shanghai and Beijing, China’s two largest cities by GDP, have both had to Restore strict COVID controls this month after persistent spikes in Covid cases.
Shanghai went into lockdown in April and May, with only a few major businesses operating. The city opened completely from 1 June.
For nearly a month in May, Beijing told people in its largest business district to work from home, while restaurants across the capital could only operate on a takeout or delivery basis. Most restaurants in Beijing were allowed to resume in-store dining in early June and staff could return to work, but schools have delayed the resumption of in-person classes.
Uncertainty, particularly about future earnings, has weighed on consumer spending. The unemployment rate in China’s 31 largest cities surpassed 2020 highs to reach 6.7% in April – the highest on record in 2018. The rate rose to 6.9% in May, while the overall unemployment rate in the cities came down to 5.9%.
The unemployment rate for youth aged 16 to 24 rose to 18.4% in May, from 18.2% in April.
Francois Huang, senior economist at Allianz Trade, said in a phone call: “I think as sanctions are eased and we have monetary policy support, the unemployment rate should come down a little bit, because we are well above the government target.” ” Interview last week.
“My scenario at the moment is that we should see some improvement in the second half of the year,” she said. “This [a] The V-shaped rebound, the quick and strong rebound, or the post-Covid recovery as we saw in 2020, is because the policy easing is not that strong and the external demand is not as strong. ,