China's factory output, retail sales, investment all miss expectations in May

Reuters reports that growth in China's factory output slowed for a third straight month in May, possibly due to disruptions caused by COVID-19 outbreaks in the country's southern export powerhouse of Guangdong.

Industrial production grew 8.8% in May from a year ago, slower than the 9.8% uptick in April, National Bureau of Statistics data showed. That missed a 9.0% on-year rise forecast.

Most China watchers had expected some moderation in May output due to softer export orders, higher cost pressures for factories and tighter environmental restrictions on heavy industry. But they said underlying activity still appears solid, even if headline growth figures are heavily distorted by comparisons to the pandemic plunge early last year.

Retail sales rose 12.4% year-on-year in May, weaker than 13.6% growth expected by analysts and down from the 17.7% jump seen in April. Chinese consumer and business confidence has been picking up thanks to pent-up demand and quickening vaccine rollouts, which are also reviving domestic tourism.

Fixed asset investment increased 15.4% in the first five months from the same period a year earlier, versus a forecast 16.9% rise, slowing from January-April's 19.9% increase.