China – August growth slowed sharply
The slowdown in the domestic economy was broad-based in August.
Tommy Wu
Commerzbank Economic Research
09/15/2025
Not only that growth in industrial production and retail sales slowed, fixed asset investment fell sharply and it was broad-based across industries. Exports were the only bright spot, but their growth also eased. We expect the government to dial up fiscal stimulus again, considering that growth is a key objective for Beijing and local governments.
Broad-based domestic weakness
China’s economy slowed markedly in August. The domestic slowdown was broad-based, notably with a sharp fall in investment.
- While industrial production still registered a decent growth of 5.2% yoy in August, it was slower than 5.7% in July and 6.4% in H1.
- On the demand side, retail sales growth eased to 3.4% yoy from 3.7% in July and 5% in H1.
- Fixed asset investment declined 7.1% yoy after -5.3% in June, based on our calculations using the headline year-to-date data. It slowed to just 0.5% yoy year-to-August compared to 1.6% in the first seven months of the year. The decline was broad-based across investment in manufacturing, infrastructure, and real estate. In particular, the decline in real estate investment deepened to almost 20% yoy.
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