CHINA’S industrial output slowed during the first two months of the year as unemployment rose, official data showed Thursday, while some indicators showed a slowdown in the world’s second largest economy stabilizing.

The figures from the National Bureau of Statistics (NBS) come as China and the United States appear to be nearing a deal to resolve their painful trade spat, and Chinese leaders convene in the capital for an annual parliamentary session.

Output growth at China’s factories and workshops for the first two months slowed to 5.3 percent year on year, from 5.7 percent in December, a multi-year low and short of forecasts.

“We must be aware that there are many uncertainties and instabilities from the external environment,” said NBS spokesman Mao Shengyong. “The economy faces downward pressure,” he told reporters.

China’s normally steady unemployment rate rose to 5.3 percent in February, from 4.9 percent in December, with the NBS saying it had expected worse numbers.

Premier Li Keqiang last week laid out a lower growth target of 6-6.5 percent this year, from 6.6 percent growth in 2018, which was already the slowest pace for almost three decades.

Policymakers in Beijing have talked up plans to support the economy, announcing tax cuts, fee reductions and financing support. A plan to cut value-added tax for manufacturers will help the struggling sector.

During the first two months, car sales continued to fall and manufacturing activity sunk.

The latest data showed growth in retail sales for the January-February period remained flat from December, rising 8.2 percent year on year and slightly above forecasts from economists polled.

However, retail sales remain near a 15-year low, said Julian Evans-Pritchard of Capital Economics in a note, adding that “the near-term outlook still looks downbeat.” (SD-Agencies)