China's economy holds steady in May

BEIJING -- China's economy held steady, as industrial production gathered pace in May, retail sales maintained strong growth while investment cooled with improved structure, official data showed on Monday.

Value-added industrial output, one of the leading indicators for economic growth, rose 6 percent year on year in May, unchanged from April and in line with expectations.

On a month-on-month basis, industrial output was up 0.45 percent in May, according to data from the National Bureau of Statistics (NBS).

In the first five months, industrial output grew 5.9 percent from one year earlier, up from 5.8 percent registered during the January-April period.

NBS spokesperson Sheng Laiyun said the data suggested China's industrial structure had continued to improve. The output of the hi-tech and equipment manufacturing industries maintained strong growth, rising 11.5 percent and 8.5 percent in May.

Retail sales climbed 10 percent in May from one year earlier, compared with an increase of 10.1 percent in April.

Fixed asset investment growth weakened to 9.6 percent in the January-May period as tepid demand and industrial overcapacity continued to weigh on the economy. This compared with a 10.5 percent increase in the four months through April.

Analysts attributed the slowdown to a falloff in private investment, growth of which slowed to 3.9 percent in the January-May period from an already weak 5.2 percent in the first four months. Private investment accounted for 62 percent of total investment in the first five months.

The slowdown in private investment showed that economic growth momentum needs to be strengthened, Sheng said, adding the economy's fundamentals remained strong.

Although investment growth cooled, Sheng said investment structure was improved with more money spent on the hi-tech and service sectors, while less money flew into industries with high energy consumption or excessive capacity.

Sheng said China's economy fared at a stable rate amid headwinds from both home and abroad, and it would maintain "stable and relative fast growth."

China will continue to push forward supply-side structural reform while expanding aggregate demand, he said.

The country's GDP expanded 6.7 percent year on year in the first quarter, the slowest growth since the global financial crisis in early 2009 but still in line with the official 2016 target range of between 6.5 percent and 7 percent.