China’s major economic indicators showed overall weakness in February. Industrial production slowed to 8.6% year-on-year in the period between January and February, down from 9.7% in December, and much lower than market consensus, according to data released by China’s National Bureau of Statistics.
February’s industrial production number was the lowest growth since the global financial crisis.
Fixed asset investment increased 17.9% year-on-year in the first two months this year, compared with 19.6% for the whole year of 2013. This was the lowest growth since 2002.
Retail sales growth softened to 11.8% year-on-year in January to February due to soft consumption during the Chinese New Year. It was the lowest growth since 2005.
Electricity production growth also slowed to 5.5%. Steel production growth eased to 4.9%, from 10.3%.
"Today’s activity data, plus the weak trade performance in February, point to a risk that China’s first quarter GDP growth will likely progress at below 7.5%," writes ANZ greater China chief economist, Liu Li-Gang, in a report.
"Further policy easing, including addition fiscal spending and a cut in the reserve requirement ratio (RRR), could be likely," he adds.