© Bloomberg. An employee pulls a rack while sorting through orders at a Cainiao warehouse, the logistics subsidiary of Alibaba Group Holding Ltd., ahead of the company’s annual Singles’ Day shopping extravaganza in Wuxi, Jiangsu province, China, on Monday, Nov. 9, 2020. Alibaba’s Singles’ Day event culminates annually Nov. 11, an online shopping phenomenon that with $38 billion of sales in 2019 easily dwarfed Black Friday and Cyber Monday. Photographer: Qilai Shen/Bloomberg(Bloomberg) — China’s economic recovery strengthened in October, with consumer spending picking up steadily and industrial production and investment rising faster than expected.
- Industrial output rose 6.9% in October from a year earlier, versus a median estimate for a 6.7% increase. Retail sales expanded 4.3% in the period, compared to a projected 5% rise. Fixed-asset investment grew 1.8% in the first 10 months of the year, versus a forecast 1.6% increase.
- The surveyed urban unemployment rate inched lower to 5.3%.
Key Insights
- The data shows China’s recovery is well on track, supported by stimulus policies, strong export demand, and a virus outbreak that’s under control. Consumer spending is also catching up quickly after a slow start, complementing the industrial-led recovery.
- Retail spending received a boost from the golden week holiday last month, though many shoppers also delayed purchases to take advantage of the Singles’ Day shopping festival in November. In the first 10 months of the year, retail sales were still down 5.9% from the same period in 2019.
- “China’s growth recovery should sustain in the fourth quarter, driven mainly by the continued recovery of consumption on the back of improving household income,” UBS Group AG (SIX:) economists led by Ning Zhang wrote in a note before the data release. “The continued recovery will likely limit government’s incentive for further easing.”
©2020 Bloomberg L.P.
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