China’s economy bests expectations amid property market fears

China’s economy performed better than expected in October as retail sales and industrial output beat estimates, relieving concern a property slump was broadening.

Industrial output rose 3.5% in October from a year earlier, according to the National Bureau of Statistics, faster than September’s reading and higher than economists’ expectations. Retail sales growth accelerated to 4.9%, above the 3.7% estimate in a Bloomberg survey of economists.

Growth in fixed-asset investment eased to 6.1% in the first 10 months of the year, compared with a forecast of 6.2%. The surveyed jobless rate was steady at 4.9%.

The better-than-expected numbers will come as a relief after the economy’s momentum weakened in the second half of the year, with both demand and supply coming under pressure. Beijing’s crackdown on the property market has slowed lending to a sector that accounts for as much as 25% of GDP, while energy shortages have caused factories to curb production.

“The national economy was generally stable and maintained the trend of recovery,” the NBS said in a statement. “However, we must be aware that the international environment is still complicated and severe with many unstable and uncertain factors.”

Separate data from the NBS showed home prices fell 0.25% in October from the previous month, a bigger decline than in September.

The CSI 300 Index maintained its loss after the data dump, down 0.3% as of 10:04 a.m. in Shangahai.

The slowdown has put the spotlight back on policy makers, who have so far taken a muted approach to stimulus, preferring to “fine-tune” policies rather than flood the economy with support.

In line with that approach, the People’s Bank of China refrained from injecting additional cash into the financial system in its monthly liquidity operation on Monday, rolling over all the loans maturing instead.

Most economists expect Beijing to stick with the property curbs, resulting in weaker growth into next year. GDP growth is expected to slow to 3.5% in the final quarter, reach 8% for the full year and weaken to 5.4% in 2022, according to a Bloomberg survey of economists.