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China economy eases in April, sparking worries on rebound

Chinese retail sales up by 10.1% in April
Chinese retail sales up by 10.1% in April

China's key economic indicators moderated in April from the previous month, official figures showed over the weekend.

This raised worries over the strength of a rebound in the world's second-largest economy. 

China's industrial output rose 6% year-on-year in April, the National Bureau of Statistics said, down from a 6.8% increase in March. 

Economists had estimated a 6.5% increase, according to Bloomberg News. 

Analysts said that industrial production was lower than expectations, indicating that the stabilisation momentum for the economy is not as strong as imagined.

They noted a strong economic rebound in March, which resulted in some correction in April. 

The Chinese economy grew at its slowest quarterly pace in seven years in the first three months of the year, expanding 6.7%, though the figure met market expectations and raised hopes it had started to improve. 

Policymakers are seeking to wean China away from cheap exports and government-led investment to rely on domestic consumers as the key driver for growth in the world's most populous country.

Separately, retail sales - an indicator of domestic consumption - rose 10.1% on the year in April, the bureau said, weaker than the 10.5% gain in March. 

Fixed-asset investment, a gauge of government spending, rose 10.5%in the three months from January to April. That was slower than the 10.7% rise in the first three months of the year.

Chinese officials say they are willing to accept slower growth to carry out structural reforms to retool the economy.

The Asian giant's economy grew 6.9% for all of last year, its weakest in a quarter of a century. Premier Li Keqiang in March set a growth target in a range of 6.5-7% for this year. 

The government has cut interest rates six times since late 2014 and also lowered reserve requirements - the proportion of funds banks must put aside - to boost the economy.

China's central bank said on Saturday it would continue to support "stable" economic growth, a day after figures showed bank lending fell sharply in April, as the government refrained from boosting credit amid concerns over growing financial risk. 

Other economic figures for April which have already been released show a mixed picture. Manufacturing activity slowed for the month and both exports and imports dropped, indications of weakness in the economy. 

China's consumer price inflation was stable at 2.3% in April but the producer price index - which measures prices of goods at the factory gate - fell 3.4% - its slowest decline in 16 months.