China’s Retail Sales Miss Forecasts in November, Adding to Economic Concerns

China’s economy showed further signs of weakness in November as key indicators fell short of expectations. Retail sales rose just 1.3% from a year earlier, well below the 2.8% growth forecast and slowing from October’s 2.9% increase. The softer reading has raised fresh concerns about consumer confidence and the broader pace of recovery.

Industrial production grew 4.8% last month, slightly below expectations for a 5% rise and the weakest performance since August 2024. Investment in fixed assets contracted 2.6% in the January–November period, marking the sharpest decline since the early months of the pandemic. Property investment continued to fall sharply, with a 15.9% drop in the first 11 months of the year.

Economists say the slowdown in investment and falling property prices have affected household sentiment. Analysts expect more fiscal and monetary support early next year as policymakers attempt to stabilise the housing market and lift domestic demand.

Housing data showed further stress in the sector. Prices for new homes in major cities fell 1.2% in November, while resale prices dropped 5.8% from a year earlier. Auto sales were another weak spot, declining 8.1% by volume after many local governments paused trade-in subsidies. Retail performance was also affected by the earlier start of this year’s Singles’ Day shopping promotions, which shifted part of November’s demand into October.

Beijing has pledged more support, including plans to issue ultra-long-term government bonds to fund security, infrastructure and consumer goods upgrade programmes. However, analysts say stronger action is needed to revive spending, improve job prospects and support private-sector growth.

China’s unemployment rate remained at 5.1% in November, while youth unemployment continues to stay elevated. Despite the weak domestic data, China remains on track to meet its growth target of “around 5%,” supported by strong exports to non-US markets. The country’s trade surplus reached a record $1.1 trillion in the first 11 months of the year.

Economists warn that China’s dependence on exports and currency depreciation to drive growth is not sustainable. The International Monetary Fund has urged Beijing to accelerate reforms that strengthen consumption and reduce reliance on external demand.