China Retail Sales Growth Eases Sharply In August

China's retail sales grew at a much weaker pace in August as the outbreak of Delta variant weighed on consumption, and industrial production growth softened amid supply chain bottlenecks and higher raw material cost.

Retail sales grew only 2.5 percent on a yearly basis in August, data published by the National Bureau of Statistics showed on Wednesday. This was much weaker than July's 8.5 percent growth and the expected rate of 7 percent.

Industrial production grew moderately by 5.3 percent year-on-year in August, but slower than the 6.4 percent increase seen in July and the economists' forecast of 5.8 percent.

During January to August period, fixed asset investment climbed 8.9 percent after rising 10.3 percent in January to July period. Economists had forecast an increase of 9 percent.

In the first eight months of 2021, property investment reportedly grew 10.9 percent from the last year.

The surveyed jobless rate came in at 5.1 percent in August. Any near-term virus-linked disruptions should prove temporary, if the flare-up in January is any indication, Julian Evans-Pritchard, an economist at Capital Economics, said.

However, the economist said the same cannot be said for the headwinds facing the property sector, which are likely to intensify further as the prop to housing demand from savings built-up during the pandemic continues to unwind.

The current strength of exports is also unlikely to be sustained as global consumption patterns normalize coming out of the pandemic, the economists noted.