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China: Investment growth at over 12-year low in July

August 13, 2014

In the January–July period, urban fixed-asset investment excluding rural households (FAI) rose 17.0% over the same period last year, which was below the 17.3% increase recorded in the first half of the year. The reading represented the weakest expansion in investment since December 2001 and undershot the 17.4% increase that the market had expected. The deceleration mainly resulted from weaker growth in both the secondary and tertiary sectors, whereas investment in the primary sector strengthened in July. In addition, the closely-watched real estate development indicator slowed further to a five-year low.

A month-on-month comparison shows that investment in urban fixed assets rose a seasonally-adjusted 1.27% in July, which was below the 1.49% increase tallied in June.

The government set a growth target of 17.5% for urban fixed-asset investment for this year. FocusEconomics Consensus Forecast participants expect fixed-asset investment to grow 18.2% in 2014, which is unchanged from last month’s Consensus. In 2015, the panel sees fixed-asset investment growing 17.6%.


Author: Ricard Torné, Head of Economic Research

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China Investment July 2014

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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