JPMorgan Econ FI-China 2Q GDP misses expectations as activity remains fragile...-109231064

AsiaPacificEconomicResearch15July2024JPMORGANwww.jpmorganmarkets.comEmergingMarketsAsia,EconomicandPolicyResearchHaibinZhu(852)2800-7039haibin.zhu@jpmorgan.comGraceNg(852)2800-7002grace.h.ng@jpmorgan.comTingtingGe(852)2800-0143tingting.ge@jpmorgan.comJiYan(852)2800-7673ji.yan@jpmorgan.comJPMorganChaseBank,N.A.,HongKongBranch•China’s2QGDPcameinnotablybelowexpectations,growing4.7%oya.Ourseasonaladjustmentsuggeststheeconomy’sgrowthmomentumslowednotablyto1.0%q/qsaarin2Q,followingsolid1Qgrowthat7.%q/qsaar.•Juneactivitydatacontinuestosendmixedsignals,withupsidesurpriseinIPgrowth,steadyexportactivityandsolidmanufacturingFAIgrowthontheonehand,andnotabledownsidesurpriseinretailsales,alongwithongoinghousingdrag.•Onindustrialproduction,JuneIPcameinaboveexpectations,growing5.3%oya,orrisingnotablyby1.1%m/msabyourestimate,followingamoderateincreaseof0.4%m/msainMay.•DomesticconsumptiondemandshowednotabledownsidesurpriseinJune,followingtemporaryimprovementinMay.Retailsalesgrewatasubduedpaceof2.0%oyainJune,orfalling1.3%m/msa.Serviceproductiongrowthalsoeasedsomewhatto4.7%oyainJune(vs.4.8%oyainMay).•Fixedinvestmentcameinlinewithexpectations,rising3.9%oyainJan-Jun,orrising3.6%oyainJune.Furtherbreakdownshowsongoingweaknessinrealestateinvestment(whichfell10.1%oyainJune),withcontinuousoutperformanceinmanufacturinginvestment(...