China’s factory output and retail sales growth slowed sharply in July, missing expectations because of Covid outbreaks and floods disrupting operations.
Reuters reports industrial production increased 6.4% year-on-year in July, according to data from the National Bureau of Statistics (NBS). Analysts had expected output to rise 7.8% after growing 8.3% in June.
Retail sales were up 8.5% against a forecast of 11.5% and down on June’s 12.1% figure.
Worst since 2020
China is dealing with its most widespread Covid outbreak since the initial cases in 2020, with lockdowns striking a blow to consumption growth just as exports slow and while flooding and chip shortages weigh on industry.
IOE&IT Daily Updates reported that China has faced a Covid-related port disruption at Ningbo-Zhoushan, the world’s third largest container port, and that a ‘zero tolerance’ policy on Covid could lead to more shutdowns.
Christmas 2021 warning comes early
British consumers are being warned to expect higher prices and shortages of some goods this Christmas due to a mixture of Chinese port closures, rising freight costs, and the HGV driver shortage, reports inews.
According to the Telegraph, retailers and shipping chiefs are scrambling to avoid a Christmas goods crisis after the Covid outbreak at Ningbo-Zhoushan port.
The shutdown has cut capacity by a quarter at the busiest time of year, as companies across the West prepare to stock up for Christmas.
Charlotte Cook, head of trade at VesselsValue, a research firm said: “Just as everyone thought container rates couldn’t climb anymore, it’s now looking likely that congestion at key ports could continue to push up rates even further.”
The country has also been hit by heavy rains in Henan province that has left more than 300 people dead and thousands evacuated.