Chinese industrial production holds steady in May but investment growth slows

Chinese industrial production held steady in May but retail sales and fixed asset investments growth unexpectedly eased, data revealed on Monday.

Industrial output increased 6% in May from a year earlier, the National Bureau of Statistics said, in line with the previous month’s growth and analysts’ expectations.

Retail sales rose 10% year-on-year in May, missing forecasts for a 10.1% increase and following a 10.1% gain the previous month.

China’s fixed asset investments, excluding rural, climbed 9.6% year-on-year in May compared to a 10.5% increase in April. Economists had pencilled in no change.

The Statistics Bureau blamed the slowdown on private firms' difficulties in accessing credit and regulatory barriers to entry in many sectors.

“Whether or not such efforts can reverse the weakness in private investment is yet to be seen,” according to Julian Evans-Pritchard, China economist at Capital Economics.

“Many of the key factors hindering the private sector, such as banks' strong preference for lending to state firms, have been common knowledge for many years and previous efforts to address the situation have largely underwhelmed.”