(Yicai Global) Sept. 15 -- China’s industrial added value, social consumption and investment growth slowed last month because of the Covid-19 pandemic and short-term factors linked to the flood season.

China’s value-added industrial prosuction rose 5.3 percent in August, slowing from 5.5 percent in July, according to data released by the National Bureau of Statistics today.

Repeated outbreaks of the coronavirus in several provinces affected industrial output to some extent, Zheng Houcheng, director of Yingda Securities’ research institute, told Yicai Global. The impact of extreme weather and severe flooding in many parts of China since mid-to-late July remained and fermented in August, he added.

“At the same time, the central government resolutely curbed the blind development of high-energy-consumption and high-emission projects,” Zheng said. “The rise in commodity prices last month pared the profit margins of small- and medium-sized enterprises, curbing their willingness to produce.”

Retail sales of consumer goods rose 2.5 percent last month, down from an 8.5 percent clip in July, the NBS data showed. The slowdown mainly resulted from the short-term pandemic and flood season, according to NBS spokesperson Fu Linghui.

But consumption growth and the upgrading of the consumption structure have not changed. There are many favorable factors to support consumption in the future, Fu added.

China’s fixed asset investment grew 8.9 percent in the first eight months of this year, down from 9.3 percent in the first seven months. Of that, infrastructure investment rose 2.9 percent, down 0.7 point from the January to July figure, the NBS data showed.

Wu Chaoming, chief economist of Chasing Securities, cited two reasons for the decline in infrastructure investment: high commodity prices have increased the cost pressure on investment and local governments face pressure to resolve hidden debt risks and need to standardize urban investment and financing platforms, which restricts their source of infrastructure funds.

Editor: Peter Thomas