China’s retail sales grows y/y in December, industrial output growth decelerates

China’s December activity indicators are showing a decelerating momentum. The country’s retail sales expanded 10.9 percent year-on-year, as compared with the 10.8 percent year-on-year print recorded in November. But on a seasonally adjusted basis, retail sales decelerated to 0.89 percent sequentially in December from November’s 0.98 percent.

Meanwhile, industrial production decelerated in December to 6 percent year-on-year from 6.2 percent recorded in November. On the other hand, fixed asset investment surprised the market on the downside, growing 8.1 percent for the whole of 2016, down from the last reading of 8.3 percent for January to November period, noted Commerzbank.

Sequentially, industrial production growth eased to 0.46 percent from 0.51 percent in the prior month on a seasonally adjusted basis. Fixed asset investment eased from 0.57 percent sequentially to 0.46 percent sequentially in December.

Markedly, private investment stayed weak at 3.2 percent for the whole of 2016, whereas investment from state-owned enterprises came in pretty solid at 18.7 percent year-on-year in 2016. The increased spending in the public sectors is not enough to counter the decline in private investment, stated Commerzbank.