Industrial output across China registered a second month of gains during May, but grew at a lesser than expected pace amid weak demand in the wake of the coronavirus crisis globally. According to official figures released by the government, industrial output grew by 4.4% YoY in the month of May, after increasing by 3.9% in the previous month.
However, economists had forecast a growth of 5% in May’s industrial output. On a positive note, this was the highest reading for this figure seen since December 2019, marking the highest rate of expansion since the beginning of the coronavirus outbreak in China, which then spread to the rest of the world.
Industrial activity has failed to pick up even after China emerged out of the lockdown amid weak external demand which has driven export orders down. Domestic demand has also been recovering at a slower than expected pace, adding to more strain in this sector.
Meanwhile, retail sales across China fell for the fourth consecutive month during May. Retail sales were down by 2.8% YoY in May, better than the 7.5% drop seen during April but more severe than economists’ forecast which was for a 2% decline.