BEIJING (Reuters) - China’s factory output rose 9.6 percent in May from a year ago, data showed on Saturday, missing e x pectations and further entrenching concerns that the world’s second-largest economy may slip into its worse downturn in years.
The Chinese central bank made a surprise move on Thursday, cutting both benchmark lending and deposit rates by 25 basis points to ward off a deep economic downswing.
It also gave banks additional flexibility to set competitive lending and deposit rates in a step moving towards interest rate liberalisation.
Economists polled by Reuters had expected China’s industrial output to rise 9.9 percent in May, improving a shade from three-year lows of 9.3 percent struck in April.
Fixed asset investment, the second-biggest driver of China’s economic growth in the first quarter after consumption, climbed 20.1 percent in the January to May period from a year ago, just above forecasts for a 20 percent rise.
Retail sales underperformed expectations for a 14.3 percent annual growth, rising instead by 13.8 percent in May from a year earlier.
Saturday’s data is the latest evidence that China’s economy is fast losing steam, a scenario likely to scare global investors who are already unnerved by Europe’s financial mayhem, and raises the pressure on Beijing to take bolder policy action to steady growth.
A Reuters poll last month showed analysts forecast the Chinese economy to grow 8.2 percent in 2012 year, its worse performance in 13 years.
Below is the data issued by the National Bureau of Statistics:
(percent change from a year earlier)
May F/C April
Industrial output 9.6 9.9 20.2
Fixed-asset investment 20.1 20.0 9.3
Retail sales 13.8 14.3 14.1
NOTE:1) Fixed-asset investment data is for the year to date.
2) China started publishing a new measure for fixed asset investment in 2011 that covers projects in both urban and rural areas, but excluded investment made by rural households.
3) Monthly figures for industrial output, retail sales and fixed asset investment are seasonally adjusted.
Reporting by Koh Gui Qing and Kevin Yao; Editing by Daniel Magnowski