China factory output, retail sales boost economic recovery

The news: China's industrial output grew at a faster pace in October and retail sales growth beat expectations in an encouraging sign for the world’s No 2 economy.

The numbers: Industrial output grew 4.6% year-on-year in October, accelerating from the 4.5% pace seen in September, and ahead of expectations for a 4.4% increase, data from the National Bureau of Statistics (NBS) showed. Retail sales, a gauge of consumption, rose 7.6% in October, aided by a favourable comparison to a weak month in the previous year.

The context: The upbeat data is an encouraging sign for an economy still showing mixed signals and significant pockets of weakness despite a flurry of support measures. China’s economy has struggled to mount a strong post-COVID recovery as a deepening property crisis, local government debt risks, slow global growth and geopolitical tensions have dented momentum. The latest data comes as a raft of other indicators for October released over recent weeks pointed to muted growth momentum. While imports grew unexpectedly, exports shrank at a quicker pace, and household borrowing remained weak.