China’s industrial output fell to its lowest level on record in the first two months of this year and urban unemployment hit its highest rate ever in February, as the coronavirus brought the world’s second-largest economy to a standstill.
The official data — some of the worst official figures ever reported by China — suggest President Xi Jinping’s attempts to expedite an economic recovery in late February have not yet had the desired effect.
Industrial output tumbled by 13.5 per cent in the first two months of this year and the urban unemployment rate surged to 6.2 per cent in February, the bureau said on Monday.
The latest economic data also showed that China retail sales plummeted by 20.5 per cent year on year in January and February and fixed asset investment fell by 24.5 per cent, down from 5.4 per cent growth when the data were last reported.
The numbers were far below analysts’ expectations with many China experts expressing surprise that government officials were willing to report such devastating figures.
“The latest activity and spending data were much weaker than expected and point to a far deeper downturn than during the Global Financial Crisis,” Capital Economics said in a note on Monday.
Growth in services production fell 13 per cent in the first two months, according to official data. Coupled with the industrial production figure, the data suggests that China’s gross domestic product growth was -13 per cent during the first two months of the year, according to Capital Economics.
“The actual shock could be much bigger than those deeply negative January-February numbers suggest, because the lockdowns started only from 23 January,” said Nomura’s chief China economist Ting Lu.
Officials in Beijing attempted to put a positive spin on the numbers, saying the impact was temporary.
“The economic development in the first two months was affected by the outbreak of Covid-19,” said Mao Shengyong at the National Bureau of Statistics. “However, from a comprehensive perspective, the impact of the viral disease is short term, external and manageable.”
But the data bode poorly for the country’s economic outlook in 2020.
The coronavirus outbreak that started in the central Chinese city of Wuhan in December has led to a widespread lockdown of cities across the country. The movement of migrant workers looking to return to factories across the country has been hindered, resulting in a serious hit to urban unemployment.
The poor economic data comes as new cases of coronavirus in China have plummeted while the number of infections has soared across the rest of the world.
China initially suffered a supply shock, with its factories unable to operate. But many economists are now concerned the country could now face a plunge in demand as the rest of the world cuts imports.
“A V-shaped recovery seems unlikely as the virus is spreading everywhere, which will pose a downside bias for external demand for China,” said Zhou Hao, senior emerging markets economist at Commerzbank.
China’s central bank has taken some monetary policy measures to help stimulate the economy but analysts said policymakers would need to do more to stimulate the economy.
Other central banks, including the US Federal Reserve, have unleashed huge stimulus packages to cushion growth as the outbreak sweeps across the US and Europe.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
