Chinese consumers pull back, but other indicators stabilize

Government blamed the deceleration on consumers holding off from making purchases until Singles Day, China’s annual discount shopping bonanza. (AFP)
Updated 14 November 2018
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Chinese consumers pull back, but other indicators stabilize

  • Retail sales slowed to an 8.6 percent year-on-year increase in October
  • The NBS blamed the deceleration on consumers holding off from making purchases until Singles Day

BEIJING: Chinese consumer spending slowed in October, official data showed Wednesday, adding to worries over the world’s second-largest economy, but investment and industrial production appeared to stabilize.
Concerns about China have increased in recent months after third-quarter growth came in at its slowest pace in nine years, and as trade frictions with the US have ratcheted upwards.
Chinese officials are currently engaging with their US counterparts as the two economic giants try to work out a compromise on trade ahead of President Xi Jinping’s meeting with Donald Trump later this month at the G20 gathering.
The National Bureau of Statistics said on Wednesday that retail sales slowed to an 8.6 percent year-on-year increase in October, slightly short of estimates and down from 9.2 percent in September.
The NBS blamed the deceleration on consumers holding off from making purchases until Singles Day, China’s annual discount shopping bonanza that was held on November 11.
“Given uncertain and unstable factors abroad, there are concerns over the slower though stable economic development which is facing downward pressure,” bureau spokeswoman Liu Aihua told a news briefing.
“The world economy and trade growth momentum have weakened while international financial markets have been turbulent.”
Exports to the major US market have held up so far but analysts forecast a dimming picture in the months ahead, reinforcing the need for China to rely on its legions of domestic consumers to grow the economy.
The trade row with the US has sapped market confidence, dragging down Chinese equities and the yuan currency.
On the positive side, fixed-asset investment, a key economic driver, showed signs of rebounding.
It expanded 5.7 percent on-year for the first ten months of the year, picking up after hitting record lows this summer as Beijing’s push to get big projects moving this autumn lifted infrastructure spending.
Output at factories and workshops ticked up 5.9 percent in October, an improvement on the 5.8 percent in September, according to the NBS, and ahead of the 5.8 percent forecast in a Bloomberg News survey.
“Despite the uptick in industrial output and investment, we doubt that economic growth has bottomed out just yet,” Julian Evans-Pritchard of Capital Economics wrote in a research note.
He said local governments had held off on issuing bonds in recent weeks as they face budget limits.
“US tariffs have, if anything, acted as a prop to exports recently (due to front-loading by US importers) but are set to become a drag early next year,” he said.


UAE’s Central Bank reshuffles board of directors

Updated 17 December 2018
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UAE’s Central Bank reshuffles board of directors

DUBAI: The UAE Central Bank’s board of directors has been reshuffled under a decree by President Sheikh Khalifa bin Zayed, according to the state news agency WAM.
Central Bank Gov. Mubarak Rashed Khamis Al-Mansoori has been reappointed for the next four years, the agency said.
Other members of the board reappointed for the next four years include Hareb Masoud Hamad Al-Darmaki as chairman; Abdulrahman Saleh Al-Saleh as vice chairman; and Younis Hajji Al-Khoori, Khalid Mohammed Salem Balama, Khalid Ahmed Altayer and Ali Mohammed Bakheet Al-Rumaithi.
The central bank said in a statement it had been working with the bank and the government of Sharjah to develop a plan to strengthen the lender’s capital base.
The UAE central bank said it would “support Invest Bank with all the available liquidity facilities, which remain at Invest Bank’s disposal; if, and when, needed.”