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Shanghai economy looked cool in August
By Wang Yanlin |
September 15, 2010, Wednesday
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Print Edition
Print Edition
SHANGHAI showed more signs of a cooling economy last month, with investment down, industrial output slowing and less retail sales growth.
But the consumer prices that measures inflation softened - a good signal when the national index continued to soar.
Analysts said they believe the moderation is just temporary and paves the way for future growth that could be stronger and more sustainable.
"The city is well paced to manage its economic development. We think Shanghai is under way to achieve its target of an 8 percent expansion, despite the recent slowdown," said Li Maoyu, an analyst at the Changjiang Securities Co.
Shanghai's fixed-asset investment dropped 5 percent from a year earlier in the first eight months, to 300 billion yuan (US$44.3 billion), diving further from the reduction of 3.1 percent through July, the Shanghai Statistics Bureau said yesterday.
Industrial output gained 21.1 percent on an annual basis to 250.3 billion yuan last month, compared with the increase of 23.7 percent in July.
Retail sales expanded 17.1 percent year on year to 51.2 billion yuan, also weaker than the advance of 18.1 percent a month earlier.
The slowdown was due mainly to less spending on food in the month, when several extremely hot days hit the city and spoiled people's appetite, according to the bureau.
"The city may post slower growth in industrial production when it is amid a critical transition to reduce reliance on exports of low-end products," Li said. "But when Shanghai's products move up the value chain, the growth will speed up again. It won't take a long time."
Mayor Han Zheng said last month that local government is prepared to sacrifice a bit of the speed of growth to guarantee a qualified restructuring.
The consumer price index, a main gauge of inflation, edged up an annualized 3.2 percent last month in Shanghai.
It softened from the swell of 3.9 percent in July and bucked the national trend of dearer prices.
China's CPI surged to a 22-month record of 3.5 percent in August.
"Shanghai may be a bit more ahead of the trend - we anticipate the national CPI will weaken in two months' time, reducing the pressure over any abrupt policy changes," Li said.
But the consumer prices that measures inflation softened - a good signal when the national index continued to soar.
Analysts said they believe the moderation is just temporary and paves the way for future growth that could be stronger and more sustainable.
"The city is well paced to manage its economic development. We think Shanghai is under way to achieve its target of an 8 percent expansion, despite the recent slowdown," said Li Maoyu, an analyst at the Changjiang Securities Co.
Shanghai's fixed-asset investment dropped 5 percent from a year earlier in the first eight months, to 300 billion yuan (US$44.3 billion), diving further from the reduction of 3.1 percent through July, the Shanghai Statistics Bureau said yesterday.
Industrial output gained 21.1 percent on an annual basis to 250.3 billion yuan last month, compared with the increase of 23.7 percent in July.
Retail sales expanded 17.1 percent year on year to 51.2 billion yuan, also weaker than the advance of 18.1 percent a month earlier.
The slowdown was due mainly to less spending on food in the month, when several extremely hot days hit the city and spoiled people's appetite, according to the bureau.
"The city may post slower growth in industrial production when it is amid a critical transition to reduce reliance on exports of low-end products," Li said. "But when Shanghai's products move up the value chain, the growth will speed up again. It won't take a long time."
Mayor Han Zheng said last month that local government is prepared to sacrifice a bit of the speed of growth to guarantee a qualified restructuring.
The consumer price index, a main gauge of inflation, edged up an annualized 3.2 percent last month in Shanghai.
It softened from the swell of 3.9 percent in July and bucked the national trend of dearer prices.
China's CPI surged to a 22-month record of 3.5 percent in August.
"Shanghai may be a bit more ahead of the trend - we anticipate the national CPI will weaken in two months' time, reducing the pressure over any abrupt policy changes," Li said.
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