China’s economy drew an unequal trajectory in the first two months of the year, a large number of key indicators was shown on Monday, entangling Beijing’s impulse to boost consumption signaling.
The authorities have sought in recent months to relive confidence in the second largest economy in the world, which has been harassed by persistent problems in the real estate sector and is now under a growing pressure of new commercial tensions with the United States.
Beijing National Statistics Office (NBS) data offered some positive signs on Monday, which show that retail sales, a key measure of consumer’s feeling, increased four percent year -on -year during January and February combined.
However, the data also showed that unemployment increased, while housing prices continued to fall into most cities.
“In the first two months, with the sustained effects of Macro policies, the national economy maintained the new and positive development,” the NBS said in a statement.
But, he warned, “the effective domestic demand is weak, (and) some companies face difficulties in production and operation.”
“The basis for sustained economic recovery and growth is not strong enough,” he said.
The urban unemployment rate surveyed, China’s main metric to measure how many are without work, increased to 5.4pc in February, said the NBS, an increase of 0.2 percentage points of the previous month.
That was above the 5.1pc forecast by Bloomberg and was the highest recorded in two years.
And, in a worrying signal for the real estate sector, a NBS price index for new commercial homes decreased year -on -year to 68 of 70 large and medium -sized cities during February.
‘Mixed messages’
China’s statistics authorities combine many economic indicators during the first two months of the year to account for possible distortions caused by annual lunar New Year holidays.
Industrial production in January and February also rose 5.9 percent year after year, according to data that slow down from the growth of 6.2pc in December.
Beijing said this month that he will aim at total growth this year of five PC, the same as last year and an objective considered ambitious by many economists.
Before a commercial war intensified under the president of the United States, Donald Trump, Chinese officials are now under pressure to boost national consumption to reduce traditional dependence on the economy in exports.
Since he assumed the position in January, Trump has slapped tariffs for a 20 percent increase in shipments abroad, which last year reached record levels.
“The international environment will become more complex and severe in the next stage,” said NBS spokesman Fu Linghui, a press conference after today’s data launch.
“But the general trend of international cooperation and common victories will not change,” said Fu.
The Government published an action plan on Sunday that hopes that the low demand for consumers can exceed, including measures such as property reform and child care subsidies.
“The macro data published today show mixed messages,” said Zhiwei Zhang, president and chief economist of Pinpoint Asset Management.
The activity data on industrial production and retail sales showed “consistent signs and beat expectations,” he wrote, although the increase in unemployment at his highest level in two years was “unexpected.”
“Unemployment is often a delay indicator, therefore, it can improve whether the most proactive fiscal policy helps maintain floating activity in the coming months,” said Zhang.
“The risk to the economy is the damage of the highest rates of the United States in China exports that will probably appear in commercial data in the coming months.”
