China's economy steadies in May even as investment growth slows

[BEIJING] China's economy steadied in May as a credit binge earlier this year moderates.

Industrial production rose 6 per cent from a year earlier in May, matching economists' estimates, the National Bureau of Statistics said Monday. Retail sales climbed 10 per cent last month, while fixed-asset investment increased 9.6 per cent in the first five months of 2016, missing all 38 economists forecasts.

Combined with improving imports and moderating factory-gate deflation last month, the data suggests policy makers have underpinned the near-term outlook with monetary stimulus and fiscal support.

"We believe sequential momentum in economic growth has likely remained resilient in May," Bank of America Corp analysts including Helen Qiao wrote in a research note ahead of the data.

"Property market recovery and improved project funding for infrastructure projects in the past few months will continue to lend support to industrial activities in the near term."

Property development investment climbed 7 per cent in the January to May period, the data showed.

BLOOMBERG