China retail sales beat expectations, factory output firm

Chinese retail sales beat estimates in November

A recovery in China, the world's second largest economy, is intact heading into the end of the year, data released on Tuesday suggests.

Industrial production rose 10 percent in November from a year earlier, broadly in line with analyst expectations and compared with an increase of 10.3 percent in October.

November retail sales rose 13.7 percent from a year earlier, above expectations for a 13.3 percent rise, while fixed asset investment rose 19.9 percent between January and November from a year ago and in line with market expectations.

A man looks prepares to enter a shop in Beijing on December 2, 2013.
Wang Zhao | AFP | Getty Images

"My reaction to these numbers is to say it's more evidence of the state enterprise sector in China ramping the economy up," said Brendan Brown, head of research at Mitsubishi UFJ Securities.

"The export numbers also shows huge capital inflows into the China credit bubble, so if you put these two things together, I think we have a fairly unsustainable picture here in China with the risks still very significant for some sort of asset price deflation going forward and serious slowdown," he added.

Data at the weekend showed exports from China rose 12.7 percent on-year in November, compared with a rise of 5.6 percent in October, driven by a recovery in demand from high-income nations.

Chinese markets showed little immediate reaction to the economic data, with the Shanghai Composite little changed and Hong Kong shares dipping 0.2 percent.

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Correction: This story has been corrected to reflect that China's exports rose 12.7 percent on-year in November.