MercoPress. South Atlantic News Agency

China's industrial output in April returned to growth but retail sales remained weak

Industrial production grew a more-than-expected 3.9% year-on-year last month in a sign that China is recovering from tough lockdown measures

China's industrial output returned to growth for the first time this year in April, official data showed on Friday, as the country continued its gradual recovery after the coronavirus brought activity to a near-halt.

Industrial production grew a more-than-expected 3.9% year-on-year last month in a sign that China – where the pathogen first emerged – is recovering from tough lockdown measures now seen in other parts of the world.

But retail sales remained in contraction territory, National Bureau of Statistics data showed, signaling that consumer demand is still weak despite China's initial success in containing the outbreak. Retail sales were down 7.5% from a year ago, an improvement from a 15.8% plunge in March.

Industrial production growth last month was better than the 1.1% contraction in March and 13.5% collapse in the first two months of this year as well – the first time industrial output shrank in three decades as the virus ravaged the economy.

Unemployment, however, crept up by 0.1 per cent from March, to 6%, adding to concerns over a post-pandemic rebound.

Nomura analysts said in a recent report that markets may have been “overly optimistic” about a swift recovery in China, pointing to collapsing external demand due to the spread of the pandemic and the growing threat of a second wave of COVID-19 infections.