China\'s industrial production growth slowed more than expected in May and the property investment deteriorated further despite supportive measures, official data revealed on Monday.
Industrial production growth decelerated to 5.6 percent in May from 6.7 percent in April, the National Bureau of Statistics reported. The rate was expected to slow moderately to 6.2 percent.
Meanwhile, retail sales posted a faster expansion of 3.7 percent annually after rising 2.3 percent in April. This was the fastest growth since February and also exceeded forecast of 3.0 percent.
In the first five months of 2024, fixed asset investment increased 4.0 percent from the previous year, slower than the 4.2 percent rise posted in January to April period.
Data showed that real estate investment was down 10.1 percent in the first five months of the year, deeper than the 9.8 percent decrease in the January to April period.
Private sector investment grew only 0.1 percent in the January to May period.
Today, the People\'s Bank of China conducted CNY 182 billion of one-year medium-term lending facility. The interest rate on the MLF was kept unchanged at 2.5 percent. The MLF acts as a guide to loan prime rates.
The central bank also injected CNY 4 billion via seven-day reverse repos at an interest rate of 1.8 percent.
Economic data developments continued to add to the case for a rate cut, and could cause a PBoC cut even if the Federal Reserve remains on hold, ING economist Lynn Song said.
The economist expects two rate cuts of 10 basis points each before the end of the year, though this could come in the form of one larger rate cut as well, depending on policymakers\' priorities.