MNI BRIEF: China Jan-Feb Investment Rebounds, Consumption Slows
Investment within China has rebounded while real estate losses taper.
China investment rebounded more than expected at the beginning of the year, with declines narrowing in the real-estate sector, though consumption failed to increase over the Luna New Year holiday, data released by the National Bureau of Statistics on Monday showed.
Retail sales decelerating to 5.5% y/y from December's 7.4% gain, though outperforming the expected 5.0%. The NBS traditionally combines data released for the first two months to rule out the impact of Chinese New Year.
Fixed-asset investment over the Jan-Feb period registered a 4.2% y/y increase, rising from the 3.0% growth in 2023 and better than the 3.4% consensus. Property investment tapered its decline for the first time since February 2023, falling 9% following the previous 9.6% decrease. Infrastructure investment and manufacturing investment grew by 6.3% and 9.4%, higher than the previous 5.9% and 6.5%.
Industrial production rose 7.0% y/y in the first two months, up from December's 6.8% and beating the 5.1% forecast.
China's central bank will likely cut its policy rates to boost core inflation, a senior policy advisor recently told MNI. (See MNI INTERVIEW: PBOC To Cut Rates To Boost Credit - Zhang Bin)