Explainer | China’s economy rebounds, but do mixed signals mean it will be short-lived? 6 takeaways from January-February data
- China’s retail sales rose by 5.5 per cent year on year in combined figures for January and February, but property investment fell by 9 per cent
- Analysts expect China’s economic recovery to continue over the coming months thanks to the increase in policy support
1. Property sector remains ‘abysmal’
Despite an acceleration in property policy easing, related investments continued to struggle and fell by 9 per cent in January and February.
Property investments in 2023 had dropped by 9.6 per cent, year on year.
“Property activity indicators continued to tread along abysmally,” said Louise Loo, China economist at Oxford Economics.
China’s economic figures for January and February are combined to smooth out the impact of the Lunar New Year holiday, which falls at different times during the two months in different years.
2. Lunar New Year boost for retail sales
China’s retail sales rose by 5.5 per cent, year on year, compared with an estimate by Chinese data provider Wind for an increase of 5.4 per cent.
“Consumers were buoyed temporarily by festivities-related spending at this start of the year,” added Louise Loo at Oxford Economics.
Huang Zichun, China economist at Capital Economics, said the decline from December was largely due to a higher base for comparison, as consumer spending surged at the start of last year thanks to China’s reopening.
