BEIJING- China’s factory output and retail sales growth slowed sharply and missed expectations in July, as new COVID-19 outbreaks and floods disrupted business operations, adding to signs the economic recovery is losing momentum.
Industrial production in the world’s second largest economy increased 6.4 percent year-on-year in July, according to data released by the National Bureau of Statistics (NBS), against expectations for 7.8 percent growth and after rising 8.3 percent in June.
Retail sales increased 8.5 percent last month, far lower than the forecast 11.5 percent increase and June’s 12.1 percent uptick.
China’s economy has rebounded to its pre-pandemic growth levels, but the expansion is losing steam as businesses grapple with higher costs and supply bottlenecks. New COVID-19 infections in July also led to fresh restrictions, disrupting the country’s factory output already hit by severe weather this summer.
Asian share markets slipped on Monday after the data showed a surprisingly sharp slowdown in the engine of global growth.
Data earlier this month also showed export growth, which has been a key driver of China’s impressive rebound from the COVID-19 slump in early 2020, unexpectedly slowed in July.
Fu Linghui, an NBS spokesperson, said at a briefing on Monday that China’s recovery remains uneven due to sporadic COVID-19 outbreaks and natural disasters.
“The domestic economic recovery still faces many challenges, and contraints on production increased,” said Fu.
China has tightened social restrictions to fight its latest COVID-19 outbreak in several cities, hitting the services sector, especially travel and hospitality in the country.
The country has also faced severe weather in several provinces, with record rainfall in Henan province last month causing floods that killed more than 300 people.
