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REPEAT: China Jan-July Investment Slowed Below Estimates

Repeats Story Initially Transmitted at 03:48 GMT Aug 14/23:48 EST Aug 13
--NBS Blames Slowdown on Impact of Hot Weather, Flooding
     BEIJING (MNI) - Fixed-asset investment growth in China was weaker than
expected in the first seven months of the year, softening from the growth rate
during January to June period. 
     Fixed-asset investment totaled CNY33.74 billion in the January-July period,
up 8.3% from the year-earlier period, the lowest growth rate since the
January-December 2016 period when it recorded an increase of 8.1%, according to
data released by the National Bureau of Statistics on Monday. The growth rate
was lower than the gain of 8.6% for the first six months of 2017, also lower
than expectations for an 8.6% increase in a Market News survey of 19 economists.
     Fixed-asset investment rose 0.61% in July on a monthly basis, lower than
the rise of 0.91% in June.
     "The slowdown was mainly due to hot weather and flood disasters that
happened in certain areas," NBS spokesman Mao Shengyong said at a press
conference on Monday.
     The main sub-indicators mostly showed a softening growth trend.
     Investment in the agriculture sector grew 14.4% year-on-year in the first
seven months, down 2.1 percentage points from that in the first six month, the
NBS said.
     Industrial sector investment grew 3.9% y/y, 0.7 percentage point lower than
that from January to June. Within the industrial sector, investment in
manufacturing grew 4.8% y/y in the first seven months, compared with 5.5% growth
in the January-June period. 
     Mining sector investment continued to shrink, falling 6.1% on an annualized
basis, but this was still an improvement over the 6.4% fall during the first six
months. Investment growth in the oil and gas exploration sector rose 6.8%, up
from an increase of 6.4% from January to June. 
     Investment in the services sector grew 11.3% in the first seven months, an
unchanged growth rate compared to the first half of the year, the NBS said.
     Infrastructure investment growth inched down to 20.9% year-on-year from
21.1% y/y growth in the January-June period. 
     "Although the data were below market expectations, they were still better
than the same period last year, indicating the economy is still comparatively
stable," Zhang Yiping, an analyst with China Merchants Securities, told MNI.
"The previous good performance caused the market to be overly optimistic about
the July data," Zhang added. 
     Fixed-asset investment in the January to July period of 2016 grew 8.1% y/y,
0.2 percentage point lower than that this year. 
     In the first seven months this year, private investment, a main contributor
to overall growth, also slowed, decelerating to a 6.9% rate from 7.2% in January
to June. Private sector investment accounted for 60.7% of total fixed-asset
investment during the first seven months of the year.
     "As corporate profits continue to improve, fix-asset investment will remain
stable in the second half of this year," the NBS Mao said. 
--MNI Beijing Bureau; +86 (10) 8532 5998; email: marissa.wang@marketnews.com
--MNI BEIJING Bureau; +1 202-371-2121; email: john.carter@mni-news.com

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