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China: Investment activity slows further in July

August 12, 2015

In the first seven months of the year, urban fixed-asset investment (FAI), excluding rural households, expanded 11.2% over the same period last year, which was below the 11.4% increase tallied in the January-June period. The print represented the softest increase since 2000 and undershot the 11.5% increase that market analysts had expected. The reading mainly reflected weaker dynamics in the secondary and the tertiary sectors, while activity in the primary sector picked up slightly. In addition, the closely-watched real estate development indicator moderated again in the January-July period, dropping to the lowest annual growth since the trough of the financial crisis in 2009.

A month-on-month comparison shows that investment in urban fixed assets rose a seasonally-adjusted 0.75% in July, which was down from the 0.88% increase tallied in June.

The government set a growth target of 15.0% for urban fixed-asset investment for this year. FocusEconomics Consensus Forecast participants expect fixed-asset investment to grow 13.8% in 2015, which is down 0.1 percentage points from last month’s Consensus. In 2016, the panel sees fixed-asset investment growth slowing to 13.1%.


Author: Ricard Torné, Head of Economic Research

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China Investment July 2015

Note: Month-on-month changes of seasonally adjusted urban fixed-asset investment index and annual growth rate (year-to-date) in %. Owing to seasonal factors related to the Lunar New Year, annual figures in January and February are reported together.
Source: National Bureau of Statistics of China (NBS).


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