Chinese industrial output growth weakens again in August
Growth in industrial output from Chinese factories fell to a fresh low in August, in another sign of how the US-China trade war and slowing economic activity is weighing on the world’s second-biggest economy. Data from the country’s National Bureau of Statistics published on Monday showed that industrial output rose by just 4.4 per cent year on year during the month, versus 4.8 in July. Analysts polled by Reuters had forecast that industrial output would grow by 5.2 per cent. August’s reading was again the worst since February 2002. Meanwhile, separate data released on Monday showed that growth in retail sales again slowed, to 7.5 per cent in August, coming in under estimates of 7.9 per cent. China’s economy grew at its slowest pace in almost three decades in the second quarter, at 6.2 per cent year on year, as trade tensions hit the country’s exports. The US and China have slapped tariffs on billions of dollars of each other’s goods.The latest raft of poorer-than-expected data will likely prompt speculation of further stimulus measures intended to boost the Chinese economy, following a cut to banks’ reserve requirement ratios earlier this month. August’s shock devaluation of the renminbi did little to boost Chinese exports, with recent data showing shipments fell by 1 per cent year on year that month. “With a strong rebound unlikely any time soon, we anticipate that policymakers will ease monetary conditions further in the coming months,” said Martin Lynge Rasmussen, China economist at Capital Economics. “A weaker renminbi is unlikely to fully offset the increasing headwinds from US tariffs and cooling global demand, and we expect a further slowdown in economic activity over the coming year as a result.”Tensions have recently thawed in the long-running trade dispute between the world’s two largest economies. President Donald Trump at the end of last week said that he would consider an “interim deal” with Beijing, while senior administrations have debated removing or reducing some of the current tariffs on Chinese goods. Last week, Mr Trump delayed the introduction of an increase in existing tariffs for two weeks until October 15, in a “goodwill” gesture towards China.