A slew of economic data out of China, which came in below forecasts on Thursday, has highlighted the continuing downward pressure facing the Asian giant.
China’s industrial output rose 7.7% in October from a year ago, while retail sales grew 11.5% in the same period.
Economists were expecting growth of 8% and 11.6% respectively.
Another important economic indicator – fixed asset investment – fell to 15.9% in October from 16.1% in September.
This, added to the fact that China’s growth slowed to a more than five-year low in the third quarter from a year earlier, is building the case for more stimulus from the government to prevent a even sharper slowdown.
“Chinese core October data came in uniformly softer and below consensus. Industrial output slowed to 7.7% year-on-year, the second weakest pace since the Lehman crisis, likely on pre-Apec factory closures,” said Dariusz Kowalczyk, economist at Credit Agricole.
“The data highlights downward pressure on the mainland economy. It will encourage further monetary easing.”
While calls for more easing from the government have been around for some time, Beijing has yet to step in with major support measures.
Zhou Hao, economist at ANZ Bank said that while it was unlikely that the fourth quarter would pick up from the downward trend, it might also be too late for Beijing to introduce measures this late in the year.
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