China's industrial growth rises as retail sales stumble
Reuters reports that China's industrial production slightly accelerated in November, while retail sales fell short. Disappointingly weak retail sales figures emerged despite large online shopping promotions and government-subsidized programs.
Industrial production in China recorded a growth of 5.4% in November compared to the same period a year earlier, surpassing analysts' forecasts, which anticipated growth at 5.3%.
Consumption falls short of expectations
Despite the production growth, retail sales in China increased by only 3.3%, lower than analysts' expectations of 4.6% growth. Even with numerous online shopping promotions and government support programs, sales in the automotive sector and other industries did not meet the expected results.
Investment in fixed assets increased by 3.3% from January to November, also below the forecasted growth of 3.4%.
Beijing's future plans
During the Central Economic Work Conference, Chinese leaders committed to increasing the budget deficit and debt issuance while prioritizing consumption growth. These decisions align with earlier commitments from the Communist Party's Politburo, which supported a more flexible monetary policy, reports Reuters.
Government advisors have recommended maintaining economic growth at 5% next year, which would require decisive actions in the face of new trade tariffs from the USA. President Trump, who will begin his second term in January, announced tariffs exceeding 60% on Chinese goods.
The stability of the yuan in question
China is considering weakening the yuan in response to U.S. trade measures, but state media Xinhua confirmed a commitment to maintaining currency stability after the CEWC conference. The Chinese GDP is expected to grow by 4.5% next year, but new tariffs could reduce this growth by as much as 1 percentage point.
