China's National Bureau of Statistics released two of China’s key economic indicators — retail sales and industrial production over the weekend and data printed disappointingly weak, underscoring the challenges policymakers face in revving up the country’s industrial engines.

Industrial production grew only 5.4% y/y in Jan-Feb (consensus +5.6% y/y), the slowest pace since 2008. Retail sales also surprised the market on the downside by a large margin, rising 10.2% y/y in Jan-Feb, versus consensus expectations of 11.0% and last year’s 10.7%.

Another crucial driver of China's economy, fixed-asset investment, rose 10.2 percent in the first two months of 2016 from a year earlier, beating analysts' expectations of 9.5 percent. However, the acceleration in headline investment growth is largely due to property investment which sped up to 3% in Jan-Feb, from 1% in 2015.

The weak data is likely to build pressure on Chinese policymakers to further ease monetary policy to cushion a slowdown. Speaking at a press conference on Saturday, PBoC Gov Zhou Xiaochuan, had said that the central bank would maintain a “prudent” monetary policy, barring any international and domestic “shocks.”

While both monetary and fiscal policy has been eased aggressively, the overall growth outlook still remains gloomy, suggesting that structural reforms are highly needed to address the fundamental issues.

“Overall, the picture is still quite gloomy. Normally, because of Chinese New Year, there’s a big drop and a big jump. This year there’s only a big drop,” said Commerzbank AG economist Zhou Hao.