The world’s second-largest economy continues to rebound from the Covid-19 crisis, largely outpacing its global peers. Both retail sales and industrial production in China have showed their highest growth since the pandemic began.
Retail sales, a vital metric for gauging economic health, rose five percent in November year-on-year, edging up from 4.3 percent in the previous month, according to official data released on Tuesday. The figure was in line with analysts’ expectations and marked the fourth consecutive month of expansion.
Another key metric, industrial production, was up seven percent last month compared to a year earlier, a slight increase from the 6.9 percent seen in October.
Both indicators showed the highest growth rate this year in the middle of the fourth quarter after a disastrous start to 2020, when the Chinese economy suffered a record contraction due to the coronavirus outbreak.
The gains in the retail sector were partly driven by record sales during the annual shopping festival known as ‘Singles’ Day’. Despite upbeat November results, the sector has not still fully rebounded, as sales are still down 4.8 percent for the 11 months of this year against the same period in pre-crisis 2019.
Analysts previously noted that consumer demand could be one of the soft spots in China’s overall recovery. Nevertheless, China is set to further expand this quarter and become the only major economy to post growth this year, while other G20 economies will face contraction.
“China’s production and demand continued to rebound steadily in the fourth quarter, the economic growth is expected to continue to accelerate compared to the third quarter,” said Fu Linghui, spokesman for the National Bureau of Statistics.
The Chinese economy expanded by 4.9 percent in the July-September quarter, up from 3.2 percent over the previous three months. In the first quarter, the national economy suffered a 6.8 percent contraction as the Covid-19 outbreak paralyzed production and overall economic activity.
Based on the recovery, Oxford Economics upgraded its outlook for China’s full-year growth to 2.1 percent, and it expects growth of 8.1 percent instead of 7.8 percent next year. Researchers from Capital Economics previously predicted that the world’s second-largest economy may expand as much as 10 percent in 2021.
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