China reported sluggish retail sales figures in May even as exports skyrocketed, highlighting persistent weakness in domestic demand and leading analysts to predict the deployment of additional stimulus measures to address the widening imbalance.Retail sales, a key gauge of consumer spending, fell by 0.6 per cent year on year in May, the first decline since China lifted its Covid-19 pandemic lockdown at the end of 2022 and down from a 0.2 per cent increase in April, according to data released by the National Bureau of Statistics (NBS) on Tuesday.The lacklustre reading – which was below economists’ forecast of a modest 0.09 per cent year-on-year increase in a Wind poll – came despite a bump in consumer activity over the Labour Day holiday, suggesting household spending remains cautious amid an uncertain job market.Industrial output, meanwhile, grew by 4.5 per cent year on year in May – up from 4.1 per cent the previous month, but lower than the 5.7 per cent in March – as China’s factories relied on soaring exports to offset an apparent recent softening of domestic demand.Ding Shuang, chief economist for Greater China and north Asia at Standard Chartered, said the country’s growth model remained heavily reliant on exports, while weak retail spending in May partly reflected demand being pulled forward by the earlier trade-in goods programme for home appliances and electric vehicles (EVs).“The boost from earlier consumption incentives was always going to be temporary,” he said. “It’s difficult to drive a sustained pickup in consumption through policy alone.”