Sumary of WRAPUP 2-China’s factories, retailers stumble on COVID-19 disruptions:
- By Stella Qiu, Gabriel Crossley4 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.
- In the industrial sector, production curbs hit output of aluminium and steel, while a drastic cut in fuel export quotas hurt China’s crude oil throughput.
- 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”.
- “As growth is approaching the lower end of the officially-estimated potential growth range of 5.0-5.7%, Beijing may step up targeted easing to generate a moderate pick-up in growth in our view,” said Jingyang Chen, Greater China economist at HSBC.
- ”Analysts also expect China to quicken spending on infrastructure projects later this year.
- FOCUS SHIFTS TO PROPERTYThe weak data comes amid growing worries problems in China’s property sector could have a wider impact on the broader economy.