China’s growth engines sputter as retail and investment hit in November
Retail sales grew just 1.3 per cent, with growth momentum slowing for six straight months, and January-November investment fell 2.6 per cent as the property slump persisted
China faces mounting pressure to ramp up stimulus as new data shows its growth engines sputtering, with retail sales growth slowing for six straight months and investment showing renewed signs of strain in November despite recent policy support.
The deceleration in consumption growth and the deepening property slump underscore the challenges Beijing faces in revitalising the economy heading into 2026.
Retail sales, a key gauge of consumer spending, grew in November by just 1.3 per cent, year on year, according to data released by the National Bureau of Statistics (NBS) on Monday.
The figure fell short of the 2.92 per cent forecast from financial data provider Wind and marked a drop from October’s 2.9 per cent increase.
Fu Linghui, a spokesman for the bureau, said China’s economy remained stable in November, sustaining the momentum of steady progress. “However, we should be aware that the economy still faces multiple challenges of external instability and uncertainty as well as insufficient effective domestic demand.”
The official said China must adopt more proactive and effective macro policies, and continue to expand domestic demand, improve supply, and optimise the allocation of both new and existing resources.
Fixed-asset investment (FAI) fell by 2.6 per cent in the first 11 months of the year, widening from the 1.7 per cent drop recorded in the January-October period. The result underperformed Wind’s projected 2.17 per cent decrease.
Gary Ng, senior Asia-Pacific economist at Natixis, said that the signs of weakness were growing in China’s consumption and real estate, and that “the magnitude of the government policies so far has not been sufficient to reverse the growth trajectory”.
“While there should be no problem achieving the [around] 5 per cent real growth target this year, the weak sentiment could exert greater pressure in 2026,” he said. “The government cannot keep powder dry for much longer and will soon step up its fiscal and monetary policy.”