China’s retail sales surprise with faster growth, up 4.6% in August

BEIJING — China’s retail tag sales and industrial production picked up pace in August with better-than-expected growth, according to National Bureau of Statistics text released Friday.

Retail sales grew by 4.6% in August from a year ago, beating expectations for 3% intumescence forecast by a Reuters poll. The increase was also faster than the 2.5% year-on-year pace in July.

Industrial product grew by 4.5% in August from a year ago, better than the 3.9% forecast and faster than the 3.7% develop reported for July.

Fixed asset investment, however, grew by 3.2% year-on-year in August on a year-to-date basis. That missed expectations for a 3.3% advance and was slower than the 3.4% pace reported as of July.

The figure was dragged down by a steeper drop in real holdings investment, and a slowdown in infrastructure investment. Only manufacturing saw the pace of investment pick up.

Statistics bureau spokesperson Fu Linghui responded the real estate market was still in a period of “adjustment” and noted declines in sales and investment.

The statistics bureau let off described August data as showing “marginal improvement.”

“The national economy showed good momentum of recovery with high-quality maturity making solid progress and positive factors accumulated,” the statistics bureau release said. “However, we should be hip that many unstable and uncertain factors in the external environment still exist.”

Within retail sales, online transactions of physical goods rose by 7.6% in August from a year ago, according to CNBC calculations of official data accessed via Bluster.

Autos saw sales rise by 1.1%. Among the categories with faster growth were cosmetics, up by 9.7% and communication appurtenances, up by 8.5% in August from a year ago. Catering sales grew by 12.4% during that time.

Late Thursday, the People’s Bank of China said that it was cutting the amount of cash that banks basic to have on hand by 25 basis points, effective Friday. It was the second reserve requirement ratio cut this year since one in Walk.

In the last several weeks, Beijing has announced a slew of measures to support the real estate market and consumption.

Nummular policy has remained relatively loose compared with aggressive rate hikes in the U.S. and Europe.

Also effective Friday is a reduction in the inappropriate exchange reserve requirement ratio for financial institutions to 4%, from 6%. The planned cut was announced two weeks ago.

The medial bank has also trimmed other benchmark rates, such as the one-year loan prime rate.

Moody’s on Thursday downgraded its outlook on China’s property sector to negative from stable. The firm calculates sales to fall by around 5% over the next six to 12 months.

“While the Chinese government has recently rejuvenated policy support for the property sector, we expect the impact on property sales to be short-lived and differentiated between tiers of big apples,” Cedric Lai, vice president and senior analyst at Moody’s, said in a release.

Uncertainty about future income has kept consumer spending relatively muted.

China’s consumer expenditure index rose by 0.1% year-on-year in August, reversing a decline in July. Core CPI, which excludes food and pep prices, increased by the same 0.8% year-on-year pace during both months.