China's Industrial Production Recovers in May... Retail Sales and Investment Stall

[Asia Economy Beijing=Special Correspondent Park Sun-mi] China's economic indicators for May still reflect the impact of COVID-19. While industrial production shows a strong recovery, consumption and investment remain subdued.

On the 15th, the National Bureau of Statistics of China announced that industrial production in May increased by 4.4% compared to the same period last year. Although this fell short of experts' expected growth rate of 5%, it was a larger expansion than April's 3.9%. The manufacturing growth rate recorded 5.2%, achieving above-average performance.

China's monthly industrial production growth rate plunged to -13.5% in January and February due to the impact of COVID-19, then showed a clear V-shaped rebound curve with -1.1% in March, 3.9% in April, and 4.4% in May.

However, unlike the rapid recovery in industrial production, retail sales and investment still reflect the shock of COVID-19. Retail sales in May decreased by 2.8% year-on-year. Although this was an improvement from the 7.5% decline in April, it still showed a negative trend, revealing that consumption has not recovered despite various government policies to stimulate consumption.

Fixed asset investment, which represents spending on real estate and infrastructure, decreased by 6.3% year-on-year, a larger decline than experts' forecast of -6.0%. Manufacturing investment fell by 14.8% from January to May, and infrastructure investment dropped by 6.3%. Real estate investment, which decreased by only -0.3%, was considered to have performed relatively well.

The unemployment rate in May was 5.9%, slightly lower than April's 6.0%. Experts believe that the unemployment rate calculated by the Chinese government does not accurately reflect the actual employment situation, and the real unemployment rate is expected to be higher.

Meanwhile, the National Bureau of Statistics of China had prepared a press conference to announce the May economic indicators on the morning of the same day, but it was canceled due to the spread of COVID-19 in Beijing.

This content was produced with the assistance of AI translation services.