Fragility in China's economic recovery persists
Economic indicators for October in China reveal that difficulties in the post-Covid-19 recovery continue in the areas of production, consumption, investment, and employment.
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The National Bureau of Statistics (NBS) released a data set covering industrial production, retail sales, fixed asset investments, and unemployment figures for the country in October and the first 10 months of the year. According to the data, while signs of recovery in production and consumption continued in October, the decline in real estate investments maintained its negative impact on economic growth.
RECOVERY IN PRODUCTION AND CONSUMPTION, STAGNATION IN INVESTMENTS
Industrial production, which calculates the output of industrial enterprises with an annual turnover of over 20 million yuan (approximately 2.76 million dollars), increased by 4.6 percent year-on-year in October, exceeding the 4.5 percent increase in September. Retail sales, considered a measure of consumption, rose by 7.6 percent year-on-year in October, surpassing the 5.5 percent increase in September.
The increase in spending during the long holiday period, which coincided with the National Day and the Mid-Autumn Festival at the beginning of October, was effective in this rise. On the other hand, fixed asset investments, which include expenditures on infrastructure, real estate, machinery, and equipment, increased by 2.9 percent year-on-year in the 10-month period, but remained below the 3.1 percent increase seen in the 9-month period. Within fixed asset investments, private sector investments decreased by 0.5 percent in the 10-month period.
DECLINE IN REAL ESTATE INVESTMENTS CONTINUES
While the decline in investments continues in the real estate sector, where debt problems are deepening, this situation is also pulling down fixed asset investments. The contraction in real estate investments, which was 9.1 percent in the 9-month period, rose to 9.3 percent in the January-October period.
UNEMPLOYMENT
In October, the general unemployment rate remained at 5 percent, maintaining its level from September. The youth unemployment rate, which has been observed to reach record levels in the last two years, was not announced this month either.
The increase in spending during the long holiday period, which coincided with the National Day and the Mid-Autumn Festival at the beginning of October, was effective in this rise. On the other hand, fixed asset investments, which include expenditures on infrastructure, real estate, machinery, and equipment, increased by 2.9 percent year-on-year in the 10-month period, but remained below the 3.1 percent increase seen in the 9-month period. Within fixed asset investments, private sector investments decreased by 0.5 percent in the 10-month period.