China’s two most-watched economic indicators, industrial output and retail sales, both declined in April, confirming what many traders already suspected: the post-Covid recovery has run out of steam.
The numbers tell a familiar story
Industrial production has been on a downward trajectory for months. In August, output rose just 5.2% year-on-year, already below expectations.
Retail sales paint an even grimmer picture. Growth hit just 1.3% year-on-year in November, a figure that would be alarming for any major economy but is especially stark for China, where domestic consumption was supposed to be the engine replacing export-led growth.
The Manufacturing Purchasing Managers’ Index, or PMI, sat at 49.2 in November. Anything below 50 signals contraction. Chinese factories were shrinking, not growing. The one silver lining was that production expectations ticked up to 53.1, suggesting manufacturers expected things to improve.
