Matt Phillips
China's lockdowns continue to punish the world's second-largest economy, with a fresh round of data suggesting a worsening outlook for growth.
Why it matters: China is the single largest contributor to world growth, so its slowdown will ripple out in the form of lower economic activity and corporate profits worldwide.
Driving the news: New data out Monday showed retail sales activity collapsed in April, with unemployment rising and exports and industrial production slowing sharply.Retail sales fell 11.1% in April, compared to the prior year, with considerable declines in major categories like restaurant spending and auto sales (a total of zero vehicles were sold in Shanghai).
China's surveyed unemployment rate rose to 6.1%, just shy of the high of 6.2% reported during the early days of the COVID outbreak in 2020.
Industrial and export activity decelerated to 4% and 3.9%, as lockdowns in key industrial hubs such as the Yangtze River delta — home to Shanghai — took their toll.
The bottom line: "The April activity data shows that the temporary disruption from the zero-COVID policy is more severe than expected, raising significant downside risk," JPMorgan analysts wrote in a research note.
No comments:
Post a Comment