In the case of industrial production, an increase of about 5.9 percent was forecast. Retail sales have also slowed down – to 3.7 percent, which is the worst result from December last year, significantly different from the expected 4.6 percent.
Despite the temporary suspension of the trade war with the USA, Chinese companies still feel the effects of poor demand and deflation. Investments in fixed assets increased in the first seven months of the year by only 1.6 percent, i.e. well below the expected 2.7 percent. The situation in the real estate sector is particularly disturbing, where the prices of new houses fell by 2.8 percent in July. in terms of year to year.
These disappointing – as Nikkei Asia “emphasized – the data is in line with previous indicators that showed the shrinking of production activity and the lowest level of construction activity since January.
“The economy is quite dependent on government support. The problem is that the efforts of the authorities were the greatest in the first months of the year, and now their impact has already been slightly weakened” – commented for the Reuters agency Xu Tianchen, a senior economist from Economist Intelligence Unit.
Beijing announced in July a subsidy program for childcare in the amount of 3.6 yuan (PLN 1.8 thousand) per year for each child up to the age of three. The government will allocate 90 billion yuan (PLN 45 billion) for this initiative. From September, the fees for the last year of the Public Kindergarten will also be abolished.
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“Nikkei Asia” analysts, however, point out that such financial support of families will not translate directly into an increase in consumption, because parents will want to put away a large part of the money saved for the future.
According to Reuters survey, China's GDP growth will slow down to 4.6 percent this year. with 5 percent last year. Beijing assumed an increase of “about 5 percent”.
