Economic woes in China lead to missed expectations in November retail sales.

• According to National Bureau of Statistics data released Monday, China's retail sales increased by 3% in November compared to the previous year, which was lower than the forecast of 4.6% in a Reuters poll.
• Retail sales in October experienced the fastest growth since February, thanks to the annual Singles' Day shopping festival that began a week earlier than the event in 2023, resulting in a sharp slowdown from the previous month's 4.8% growth.

According to National Bureau of Statistics data released Monday, China's retail sales increased by 3% in November compared to the previous year, which was lower than the forecast of 4.6% in a Reuters poll.

Retail sales in October experienced the fastest growth since February, thanks to the annual Singles' Day shopping festival that began a week earlier than the event in 2023, resulting in a sharp slowdown from the previous month's 4.8% growth.

Industrial production in November increased by 5.4% compared to the previous year, exceeding the predicted growth rate of 5.3% among economists surveyed by Reuters, and also matching the growth rate recorded in the previous month.

This year, the world's second-largest economy has been facing pressure from various sources, including a prolonged property downturn, local government debt risks, and high unemployment, which has negatively impacted both consumer and business confidence.

Stuttering recovery

At high-level economic policy meetings, Chinese leadership expressed increased urgency to strengthen the economy and shifted the country's policy focus to increasing consumption, as Beijing prepares for a possible trade conflict with the U.S.

The officials pledged to use "active financial methods" and "relaxed" monetary policies in the upcoming year, as well as "forcefully" boost domestic consumption and stimulate demand in all areas, according to Xinhua News Agency.

Beijing acknowledged its monetary policy should be loose for the first time since the 2008 global financial crisis.

Beijing has intensified its stimulus efforts to revive its struggling economy, including cutting interest rates and easing property purchase rules. Additionally, the finance ministry announced a five-year, 10 trillion yuan ($1.4 trillion) program in November to address local government debt issues.

The latest economic data from China have highlighted the ongoing deflationary pressures in the struggling economy.

Despite sluggish consumer demand, the country's imports declined by 3.9%, marking the sharpest fall since September 2023, while exports rose by smaller-than-expected 6.7%.

Beijing's stimulus measures, announced so far, have not directly encouraged consumption through a trade-in program for cars and home appliances.

The annual legislative sessions in March will reveal more specifics and details about the policy focus and direction for next year, which were discussed during the economic planning meetings last week.

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