Sumary of WRAPUP 1-China’s factory, consumer sectors stumble on COVID-19 disruptions:
- By Reuters Staff4 Min ReadBEIJING (Reuters) -China’s factory and retail sectors faltered in August with output and sales growth hitting one-year lows as fresh coronavirus outbreaks and supply disruptions threatened the country’s impressive economic recovery.
- “Recent economic data reflected the overall demand is still weak in the economy, vulnerable to sporadic COVID-19 outbreaks, but some sectors have been overheated, judging from the persistently high commodity prices,” said Nie Wen, Shanghai-based economist at Hwabao Trust.
- China’s vehicle sales slid in July for a third consecutive month, partly driven by the global auto chip shortages.
- Some steel producers in China’s Jiangsu, Fujian and Yunnan provinces were told by the government to cut production as the country aims to curb industrial pollution.
- China’s services activity slumped into contraction in August, a private-sector survey showed, as restrictions to curb COVID-19 once again closed shopping malls and many businesses in parts of the country.
- KFC operator Yum China Holdings Inc said on Tuesday its adjusted operating profit would take a 50% to 60% hit in the third quarter as the spread of the Delta variant in China closed restaurant and “sharply reduced sales”.
- “We had been expecting services activity to rebound strongly in September as the virus situation was back under control,” said Julian Evans-Pritchard, Senior China Economist at Capital Economics.
- FOCUS SHIFTS TO PROPERTYChina’s property investment in August rose 0.3% from a year ago, the slowest pace in 18 months, while growth in new home prices eased an eight-month low, as an official crackdown on speculative purchases hit demand.