Important economic figures for November are expected to reveal that China's strong export performance was offset by the country's domestic demand, which remained muted or even decreased.
According to the median prediction of analysts surveyed by Bloomberg, retail sales increased 2.9% in November compared to the same month last year, according to data to be announced by the National Bureau of Statistics on Monday. That would be the lowest rise since August of the previous year.
Compared to the same period last year, investment in fixed assets, such as factories, new properties, and machinery, decreased by 2.3% between January and November.
According to Bloomberg calculations, that would represent a decline in numbers not seen since 1998 outside of the Covid crisis. China's ongoing real estate crisis is largely to blame for that.
Industrial production, a crucial indicator for a Chinese leadership that places a high value on manufacturing capabilities, is expected to increase by 5% in November compared to the same month last year. Despite a recovery in export growth last month, that would only represent a small increase from 4.9% in October.
Industrial production, a crucial indicator for a Chinese leadership that places a high value on manufacturing capabilities, is expected to increase by 5% in November compared to the same month last year. Despite a recovery in export growth last month, that would only represent a small increase from 4.9% in October.
In a previous note anticipating the numbers, Yu Xiangrong and other economists at Citigroup Inc. wrote, "Most activity indicators could have stayed lackluster."
The impacts may still be in "a very early stage" when it comes to the sectors of the economy related to building, despite the fact that authorities have taken steps to inject stimulus, they noted.
The danger of depending on foreign demand to drive the economy would be highlighted by a bad batch of data. After an unexpectedly good 2025, exports are generally expected to decline next year as trade tensions with non-US countries worsen.
The danger of depending on foreign demand to drive the economy would be highlighted by a bad batch of data. After an unexpectedly good 2025, exports are generally expected to decline next year as trade tensions with non-US countries worsen.
At important economic gatherings this week, China's senior officials stated that increasing domestic demand is the country's main objective for the coming year, indicating caution against trade uncertainty outside.
They promised to maintain growth-promoting policies, but no bold initiatives seem to be in the works just yet. A decline in auto sales and an earlier-than-normal start to "Singles' Day" were probably the main causes of the anticipated reduction in November's spending growth.
According to economists at Goldman Sachs Group Inc., including Lisheng Wang, some demand shifted into October as a result of the calendar change for the online shopping promotion.
Among all categories, automobiles account for one of the largest share of retail sales in China, at around 9%. According to figures previously released by the China Passenger Car Association, retail vehicle sales fell by almost 8% last month, a rare decrease during what is often the busiest time of the year.
According to the CPCA, the decline picked up speed in the first week of December, with sales down 32% from the previous year. The decline may be a sign that a major government initiative to encourage consumer purchasing of products like vehicles with subsidies is diminishing.
Lu Ting and other analysts at Nomura Holdings Inc. stated in a note on Thursday that "this sharp contraction signals an intensifying payback effect from the trade-in program." They estimate that 52% of cars sold in the first 11 months of the year used the financial benefit.
Last month, analysts were perplexed by October's decline in investment spending on the more industrial side of the economy. According to Goldman economists, the NBS's statistical correction of previously overreported data contributed to the decline. Goldman also cited the property decline and the government's "anti-involution" effort, in which officials are attempting to combat overcapacity and destructive competition.
Last month, analysts were perplexed by October's decline in investment spending on the more industrial side of the economy. According to Goldman economists, the NBS's statistical correction of previously overreported data contributed to the decline. Goldman also cited the property decline and the government's "anti-involution" effort, in which officials are attempting to combat overcapacity and destructive competition.
Fixed asset investment fell 9.5% this month compared to a year ago, according to the bank's experts, following a 11.4% decline in October. For that data series, the NBS does not provide monthly values broken down by year.
At their Central Economic Work Conference earlier this week, Chinese authorities pledged to boost investment through actions like boosting central government spending, making the most use of local special bonds, and utilizing a bank financing mechanism.
At their Central Economic Work Conference earlier this week, Chinese authorities pledged to boost investment through actions like boosting central government spending, making the most use of local special bonds, and utilizing a bank financing mechanism.
They also pledged to stabilize the real estate market and ease local financial burdens. In a meeting summary published on Thursday, legislators stated, "We will push for investment to stop declining and stabilize."
