China’s economy shows signs of cooling

May 15, 2017

BEIJING - China’s economy showed signs of slowing in April as increases in the key activity indicators of industrial production, investment and consumption all softened, adding to evidence that intensifying government measures to curb property bubbles and financial risks are taking effect.

Caixin reports that while property and Government-led infrastructure investment remained solid, growth in manufacturing and private sector investment lost steam, power generation rose at a slower pace and demand for many consumer goods moderated as the housing market cooled, data from the National Bureau of Statistics (NBS) showed.

“The recovery, which is driven by reflation, restocking and real estate, has passed its peak for sure,” Larry Hu, a Hong Kong-based economist with Macquarie Capital Ltd., said in a research note, although adding that the economy is “still doing OK for now”.

“The next couple of months remain the window for policy-makers to deal with financial risks,” he said. “But they will have to spend more time supporting growth from the third quarter, as the 6.5% bottom line will be tested in the fourth quarter.” (ATI).