China: Cautious consumers constraining the economy recovery – NBF

The latest economic data from China continues to highlight some challenges in its recovery phase – with consumer trends remaining weak and export markets looking constrained going forward, per the National Bank of Canada.

Key quotes

“Our forecasts are unchanged – with economic growth of 1.0% in 2020 (the weakest growth rate since 1976), before increasing by 9.75% in 2021.”

“China’s industrial production increased in April – up by 3.9% yoy (compared with a 1.1% yoy fall previously). It is worth noting that this increase was far below the typical pre-COVID-19 rates.”

“China’s trade balance widened in April – totalling US$45.3 billion (from US$19.9 billion in March). Exports rose strongly month-on-month, while imports declined, even as a wider range of countries imposed COVID-19 countermeasures.”

“China’s retail sales continued to fall in April – down by 7.5% yoy (from -15.8% yoy in March).”