China: May fixed asset investment and retail sales data missed market expectations

Research evidence excerpt

China: May fixed asset investment and retail sales data missed market expectations

Economics Research

16 June 2026 | 12:17PM HKT

China: May fixed asset investment and retail sales data missed market

expectations

Bottom line: Lisheng Wang

+852-3966-4004 |

lisheng.wang@gs.com

China’s May fixed asset investment and retail sales data missed market expectations, Goldman Sachs (Asia) L.L.C.

while industrial production was largely in line. Industrial production (IP) growth rose

modestly to 4.5% yoy in May from 4.1% yoy in April thanks to

stronger-than-expected exports, with faster output growth in computer and other

equipment, electronic machinery, and utilities industries more than offsetting slower

output growth in chemicals and non-ferrous metal smelting industries. On a

single-month basis, fixed asset investment (FAI) growth fell further -10.6% yoy in

May from -8.2% yoy in April, reflecting both adverse weather conditions and a

still-slow pace of government bond issuance. Retail sales growth continued to slow in

May, to -0.6% yoy from +0.2% yoy in April, the lowest since December 2022, partly

due to last May’s high base. That said, the services industry output index growth –

which is on a real basis and tracks tertiary (services) GDP growth closely – edged up

to 4.4% yoy in May from 4.3% yoy in April, and we believe its widening gap with retail

sales growth suggests that services consumption growth continued to outperform

goods consumption growth. Weaker-than-expected April-May activity data pose a

downside risk to our Q2 real GDP growth forecast (4.0% qoq sa annualized and 4.7%

yoy currently), while the latest development in the Middle East and recent policy

communications bode well for a sequential growth improvement in Q3, in our view.

Asia-MAP scores: