China’s industrial output likely eased slightly in April

China is likely to post another strong activity growth data for April after recording a considerable recovery in March. Growth in China’s industrial output is expected to have slowed by just 0.1 percentage point to 6.7% y/y last month, said Societe Generale in a research report. This is partially because of a negative base effect. Improving domestic investment demand is still likely to be the main factor underpinning the strength.

Meanwhile, fixed asset investment growth is likely to have quickened to 13% y/y in April from 11.1% y/y in the prior month, driving the year-to-date growth to 11.5% y/y, added Societe Generale. Growth in the real estate investment is expected to continue on an upward trend. But sales of housing are likely to have to have peaked in March. Housing sales have begun softening due to policy tightening in top-tier cities. Meanwhile, nominal retail sales are expected to have expanded 10.4% y/y in April as compared with March’s print of 10.5% y/y due to weaker inflation.