China's factory output resists tariff impact, retail sales fall short

China’s factory output slowed in April but showed surprising resilience, a sign that government support measures may have cushioned the impact of a trade war with the US that threatens to derail momentum in the world’s second-largest economy.

- TINA QIAO ELLEN ZHANG RYAN WOO

Industrial output grew 6.1% from a year earlier, National Bureau of Statistics (NBS) data showed yesterday, slowing from 7.7% in March but beat a forecast 5.5% rise in a Reuters poll.

"April's resilience is in part a result of 'frontloaded' fiscal support," said Tianchen Xu, senior economist at the Economist Intelligence Unit, referring to stronger government spending.

The data followed firmer-than-expected exports earlier this month that economists said were supported by exporters rerouting shipments and countries buying more materials from China amid a re-ordering of global trade due to US President Donald Trump's tariffs.

However, yesterday's data underscored the shock from US reciprocal tariffs, Mr Xu said, adding “despite the rapid growth in industrial value-added, the export delivery value was nearly stagnant.”

Beijing and Washington reached a surprise agreement last week to roll back most tariffs imposed on each other’s goods since early April. The 90-day pause has put the brakes on a trade war that has disrupted global supply chains and stoked recession fears.