China retail sales contract while exports and industrial output rise, Gregory Daco notes

China retail sales contract while exports and industrial output rise, Gregory Daco notes
China spending weak, exports surge

Gregory Daco reports that China experienced a contraction in consumer spending in May for the first time since the pandemic, while investment also showed signs of deterioration.

Data indicate retail sales fell 0.6% year-over-year, and fixed asset investment dropped 4.1% year-to-date. However, industrial production increased by 4.5% year-over-year and exports surged 19%, with chip exports rising 111%.

Daco previously reported that U.S. headline CPI inflation reached 4.2% in May, the highest reading since April 2023, while core inflation held at 2.9% earlier this month. In a separate note, he highlighted plans by Kevin Warsh to revamp Federal Reserve communication, with a potential reversal of forward guidance on rates expected this June according to his recent coverage. These updates add to the ongoing tracking of major economic indicators.

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