China's industrial production and retail sales beat expectations

China’s August retail sales and factory output beat expectations, but fixed asset investment pressure came in slightly below expectations. Chinese economic activity showed signs of recovery after a long time. In August, Chinese industrial production rose 4.5 percent annually, while retail sales rose 4.6 percent, significantly beating expectations. Economists had expected industrial production to grow 3.9 percent and retail sales to grow 3 percent. The positive data came after the Chinese government took action to encourage sectors including home furnishings and housing. “Perhaps peak pessimism is behind us. The August data showed that the economy is unlikely to experience a sustained and deep slowdown,” StanChart Economist Ding Shuang said. The downturn continues in the real estate sector, the soft underbelly of the Chinese economy. New home sales fell 0.29 percent in August. The People’s Bank of China kept its medium-term policy rate, the one-year lending rate, at 2.50 percent.