China's economy loses momentum – retail sales disappoint

China's economy lost significant momentum in April. Key economic data fell short of analysts' expectations.

According to data released by the National Bureau of Statistics on Monday, retail sales rose by only 0.2 percent in April compared to the same month last year. This follows a 1.7 percent increase in March. Industrial production grew by just 4.1 percent, down from 5.7 percent in March. Investments also disappointed, falling by 1.6 percent in the first four months of the year compared to the same period last year. In the first quarter, they had still grown by 1.7 percent. Experts surveyed by Bloomberg had anticipated significantly better figures for all three indicators.

Fu Linghui, a spokesperson for the National Bureau of Statistics, highlighted the resilience of the Chinese economy when presenting the figures. He pointed to the ongoing geopolitical conflict in the Middle East; increased volatility in the international energy market; and strains on global supply chains. At the same time, Linghui acknowledged that there were many external uncertainties. The cost burden for companies has increased, and some firms remain under pressure.

China's economy had shown robust growth at the beginning of the year. In the first quarter, the gross domestic product grew by 5.0 percent, placing it at the upper end of the official annual target of 4.5 to 5.0 percent. Exports also proved surprisingly resilient despite the war in Iran and higher energy prices.

Economists currently see weak domestic demand as the central problem. Additionally, if the conflict in the Middle East persists and further burdens the global economy, this could also become problematic for China. The People's Republic is heavily reliant on exports. If demand from other countries weakens, a key pillar of the Chinese economy would be undermined.

This article was translated to English using an AI tool.

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