China’s retail sales growth slows more than expected in July

China’s retail sales growth slows more than expected in July

August 16, 2021

BEIJING — China released economic data for July that showed slower-than-expected growth.

Retail sales rose by 8.5% in July from a year ago, lower than the forecast 11.5%, according to analysts polled by Reuters.

Industrial production grew by 6.4%, also below expectations of a 7.8% year-on-year increase in July, according to the Reuters poll.

Fixed asset investment for the first seven months of the year rose by 10.3%, below the forecast of 11.3% year-on-year growth for the January to July period, according to Reuters.

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Economists have cut their China GDP forecasts given the latest wave of travel restrictions and residential community lockdowns in the wake of the spread in the last two months of the highly contagious Delta variant within the country.

Goldman Sachs expects 8.3% growth this year, down from 8.6% previously, according to an Aug. 8 note.
Nomura predicts 8.2% GDP growth for the year, down from 8.9%, according to an Aug. 3 note.

Although the number of new Covid cases is low compared with other countries, the economic impact could be greater since China has taken a "zero tolerance" approach. Last week, authorities shut a terminal of the world's third-busiest port after one worker was infected.

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