China’s Economic Data for First Two Months of 2024 Beats Analysts’ Expectations
High-rise residential and commercial buildings are being constructed near Dongyu Road, Qiantan, in the Pudong New Area of Shanghai, China. Photo credit: Nurphoto | Nurphoto | Getty Images
China’s economic data for the first two months of 2024 exceeded analysts’ expectations as retail sales, industrial production, and fixed asset investments all posted strong gains. The unemployment rate in cities for the month of February was reported at 5.3%, and online retail sales of physical goods rose significantly from the previous year.
Despite the positive economic indicators, investment in real estate fell by 9%, indicating a period of adjustment in the property market. National Bureau of Statistics Spokesperson, Liu Aihua, mentioned that real estate remains in a period of “adjustment” during a press conference.
Economic figures for January and February are typically combined in China to account for the Lunar New Year holiday, which can cause variations in data due to factories and businesses remaining closed. This year, the holiday saw an increase in domestic tourist trips and revenue compared to the previous year and pre-pandemic levels in 2019.
However, retail sales did not rebound as strongly as expected, and new loans in February fell short of expectations, leading analysts to call for more monetary policy easing. The People’s Bank of China Governor, Pan Gongsheng, hinted at the possibility of cutting the reserve requirement ratio to stimulate borrowing.
The real estate sector, which plays a significant role in household assets, has been struggling in recent years due to government crackdowns on excessive debt. Property prices in major Chinese cities saw a decline in February, indicating continued weakness in the real estate market.
Chinese authorities did not announce major support for the real estate sector during the recent parliamentary meeting, shifting focus towards manufacturing and technology development. Data also showed an increase in exports and imports for January and February, surpassing expectations.
As the situation continues to evolve, stay tuned for updates on China’s economic landscape.
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