China industry growth slumps to 17-year low

Business | Reuters and Kevin Xu 15 Aug 2019

China's industrial output growth slowed markedly to 4.8 percent in July, data from the National Bureau of Statistics showed, the weakest pace since February 2002, pointing to further slowing in the economy as the US trade war takes a heavier toll on businesses and consumers. It was also lower than the 6.3 per cent rate of growth recorded in June

Retail sales meanwhile rose 7.6 percent, well off consensus of 8.6 percent and weaker than the most pessimistic forecast. Sales had jumped 9.8 percent in June, which many analysts had predicted would be temporary. Analysts said the latest data was evidence that demand had faltered across the board last month, from industrial output and investment to retail sales.

Meanwhile, China's yuan funds outstanding for foreign exchange fell for 12 straight months. The funds stood at 21.24 trillion yuan (HK$23.73 trillion) at the end of last month, down by 708 million yuan from a month before, according to the People's Bank of China.

The PBOC issued 30 billion yuan of offshore bills in Hong Kong yesterday, at lower coupon rates compared with the counterparts issued in May, just a week after the yuan slumped past the key level of 7 per dollar.

The 20 billion yuan three-month tranche was priced with a coupon of 2.9 percent, down by 10 basis points compared with the 10 billion yuan three-month bill issued in May at an interest rate of 3 percent, according to the Hong Kong Monetary Authority. The balance are one-year bills at interest rate of 2.95 percent, down by 15 basis points compared with the 10 billion yuan one-year bill issued in May at 3.1 percent.

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