THE slowdown in China’s factory and consumer sectors deepened in August, with industrial production growing at the weakest pace in 17-1/2 years, a sign of increasing weakness in an economy lashed by trade headwinds and soft domestic demand.

Production rose 4.4 percent in August year on year, slower than the 4.8 percent growth in July. Analysts polled previously had forecast output would rise 5.2 percent.

August’s data is the slowest growth since February 2002.

The data also showed retail sales growth at 7.5 percent, below the 7.9 percent expected in a recent poll and the 7.6 percent increase in July.

Fixed-asset investment for the first eight months of the year rose 5.5 percent, according to data published by the National Bureau of Statistics, compared with a 5.6 percent rise forecast by analysts.

Data last week showed factory-gate prices fell at their fastest pace in three years and analysts predict that producer deflation will continue to worsen in the coming months.

It also follows a factory survey that showed activity shrank for the fourth straight month as the trade tensions dragged on. China’s imports of unwrought copper also fell 3.8 percent year on year in August, a metal with wide use in infrastructure, power and consumption.

To counter the weakness, analysts expect the latest slew of numbers will lead to more cuts to key lending rates from Chinese authorities. The government has said it will keep a relatively restrained hand.

China has already cut the amount of cash banks are required to hold in reserve, a move that is expected to release 900 billion yuan (US$126.35 billion) for lending.

Private sector fixed-asset investment, which accounts for about 60 percent of the country’s total investment, grew 4.9 percent in the January-August period, compared with a 5.4 percent rise in the first seven months of 2019.(SD-Agencies)