China’s major economic indicators weakened slightly in July, but analysts said the trend of stable growth remains and will carry into the second half of the year.
Year-on-year growth of industrial output, investment and retail sales all dropped slightly last month, but employment and exports held up, according to data released by the National Bureau of Statistics on Aug 14.
Industrial output growth stood at 6.4 percent year-on-year, compared with 7.6 percent in June. Fixed-asset investment growth rose by 8.3 percent in the first seven months, easing from 8.6 percent in the January-June period. And retail sales grew by 10.4 percent in July, down from 11 percent in June.
The NBS said extreme weather, including high temperatures and flooding, has reduced economic activity and led to slower growth of industrial output and investments. The average temperature in July was the highest since 1961, causing increased factory equipment repairs, it said.
“The weakening of economic indicators in July is only a short-term fluctuation and will not change the overall stable and improving trend of the economy,” said Zhang Liqun, an economist at the State Council’s Development Research Center.
Zhang said that industrial output growth has been above 6 percent for more than a year, which, together with rising corporate profits, indicates improving conditions.
Hu Yuexiao, an analyst at Shanghai Securities, agreed the declines are an anomaly. “The slower growth of those economic indicators is mainly affected by temporary factors, such as weather, and it does not reflect the longer-term trend.”
Zhang Yiping, an analyst at China Merchants Securities, said that those indicators have grown at higher rates than a year ago, but that growth is slowing down, indicating that growth momentum has remained uninterrupted.
Looking ahead, the economy is set to maintain its stable growth in the second half of the year, NBS spokesman Mao Shengyong said at a news conference.
Real estate investment was brisk in the January-July period, increasing by 7.9 percent year-on-year. Commercial housing sales rose by 14 percent and 18.9 percent in terms of area and value, respectively.
The unemployment rate, meanwhile, stood at about 5.1 percent in urban areas in July, lower than a year ago, according to surveys conducted by the NBS. Mao said 8.55 million jobs were created in the first seven months, 200,000 more than a year ago.
Export growth also was strong and consumer inflation was mild in July, Mao said.