SIMIC

Output grew 3.5 per cent in October from the same period a year ago, official data showed, accelerating from a 3.1 per cent increase in September. Retail sales growth also picked up, reports Reuters.

The industrial output growth beat expectations of a 3.0 per cent year-on-year increase in a Reuters poll of analysts, but remained the second lowest print this year.

The world's second-largest economy had staged an impressive rebound from last year's pandemic slump, but has since lost momentum as it grapples with a slowing manufacturing sector, debt problems in the property market and Covid-19 outbreaks.

"Economic momentum remained weak in October, with the real estate downturn weighing on industry," said Louis Kuijs, head of Asia economics at Oxford Economics, in a note.

The National Bureau of Statistics (NBS) data also showed retail sales accelerated even as China imposed fresh restrictions to fight a new wave of COVID-19 cases in the north.

Retail sales rose 4.9 per cent year on year in October, beating expectations for 3.5 per cent growth and after a 4.4 per cent increase in September.

"Growth will likely weaken in the rest of this year," said Zhiwei Zhang, chief economist at Pinpoint Asset Management.

"The Covid outbreak has forced more cities to tighten travel restrictions, which will likely affect the service sector adversely in November. The property sector slowdown is getting worse," Mr Zhang said, adding this was "the key risk for the macro outlook in the next few quarters."

NBS data showed property investment and sales growth continued to slow over January-October compared with the first nine months, and new construction starts measured by floor area fell.

Sentiment in China's property market has been shaken by a deepening debt crisis, with property giant China Evergrande and Kaisa Group grappling with looming defaults.

China's sprawling manufacturing sector has slowed this year after a blistering recovery from the Covid-19 slump, with electricity shortages and production cuts hampering production in recent months.

Policy sources and analysts have told Reuters that China's central bank will likely move cautiously on loosening monetary policy to bolster the economy, as slowing economic growth and soaring factory inflation fuel concerns over stagflation.

Fixed asset investment continued to slow, the NBS data showed, rising 6.1 per cent in the first 10 months from the same period a year earlier, compared with the 6.2 per cent increase tipped by a Reuters poll and the 7.3 per cent rise in January-September.