Li Qiang Urges Stimulus Measures as Data Points to Slowdown
Macro Impact 4
Chinese Premier Li Qiang has called on officials to speed up measures supporting economic recovery, after the latest data signaled a slowdown across all sectors in July and growth looks set to fall short of the government's annual target. Speaking at a State Council meeting on Monday, he said the country must stick to its development goals, make the most effective use of existing policies, and move quickly to formulate additional practical and effective measures. He also pledged to accelerate the shift toward new growth drivers, focusing on large projects such as the six major networks and sectors with broad supply chains and significant economic weight, in order to boost domestic demand. This includes speeding up budget disbursement, increasing support for investment in emerging industries and new types of infrastructure, and lifting consumption. The pledge came after China's National Bureau of Statistics released weak economic data, with July retail sales rising only 0.6 percent year on year, slowing from 1 percent in June and below the 1.5 percent analysts had expected. Industrial output rose 4.5 percent, down from 5.3 percent and below the 4.8 percent forecast. Urban fixed-asset investment in the first seven months fell 6.7 percent year on year, worse than the expected 6 percent decline and steeper than the 5.7 percent drop in the first six months. The urban unemployment rate rose to 5.2 percent from 5 percent in June. Many economists expect gross domestic product growth to fall further below the annual target range of 4.5 to 5 percent, after second-quarter GDP expanded only 4.3 percent, the slowest pace since late 2022.
