- BusinessNZ
China's industrial production slowed to the weakest growth since the financial crisis, sparking concerns over the global recovery. Industrial output increased by 5.4% in January and February, the worst performance since 2008, according to the National Bureau of Statistics. Economists, however, had expected a slight retreat to a 5.6% gain from December's 5.9% annual growth. In addition to that, retail sales, which had been a driver of strength in China's economy, advanced 10.2% over the year, against economists' forecast for a 10.8% growth and well below the December growth rate of 11.1%. Recent data also revealed that China's exports plunged 25.4% in February compared with the same month last year. It was the biggest monthly drop since 2009.
The weak production data suggest that the first-quarter growth could slide toward the bottom of Beijing's 6.5% to 6.7% target growth range for 2016 following economic growth of 6.9% in 2015, economists expect. A plethora of stimulus measures late last year and into 2016, including the most recent a 0.5 percentage point cut in bank reserves in January, have yet to reverse the lost in momentum. The PBoC also hopes that the stimulatory efforts by central banks in Europe and Japan, as well as a continued recovery in the US, will help to cushion China's growth.
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