CHINA’S factory output and retail sales grew at a faster pace in August as a flurry of support steps by the government are showing signs of stabilizing parts of the economy.

Industrial output rose 4.5% in August from a year earlier, data released Friday by the National Bureau of Statistics (NBS) showed, accelerating from the 3.7% pace in July and beating expectations for a 3.9% increase in a poll of analysts. The growth marked the quickest pace since April.

Retail sales, a gauge of consumption, also increased 4.6% year on year in August, aided by the summer travel season, the quickest growth since May. That compared with a 2.5% increase in July and an expected 3% rise.

The upbeat data suggest that a spate of recent measures to shore up the economy are starting to bear fruit, prompting JP Morgan to raise its forecast of China’s 2023 gross domestic product growth to 5% from prior 4.8%.

ANZ also upgraded its growth forecast for the world’s second-largest economy by 0.2 percentage points to 5.1%.

Friday’s data followed better-than-expected bank lending figures, a narrowing in the declines of exports and imports as well as easing deflationary pressure.

China’s passenger vehicle sales also returned to growth in August from a year earlier, as deeper discounts and tax breaks for electric vehicles boosted consumer sentiment.

To sustain the recovery momentum, China’s central bank said Thursday it would cut the amount of cash banks must hold as reserves for the second time this year to boost liquidity.

Earlier in the day, the central bank also rolled over maturing medium-term policy loans to inject more liquidity into the financial system.

“The reserve requirement ratio cut Thursday sent an interesting signal that there is a sense of urgency to boost growth,” said Zhang Zhiwei, chief economist of Pinpoint Asset Management, expecting more policies over the coming months to boost overall demand.

Fixed asset investment expanded at a slightly slower pace of 3.2% in the first eight months of 2023 from a year earlier, versus expectations for a 3.3% rise. It grew 3.4% in the first seven months.

The nationwide survey-based jobless rate improved a touch to 5.2% in August versus 5.3% in July. (SD-Agencies)