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China's economy showed further signs of softening in July despite a burst of government stimulus measures, suggesting more policy support may be needed to keep growth on track.
An encouraging performance from factories, where output for July met market forecasts, was offset by less buoyant activity for investment and retail sales, where growth was not as strong as expected, while the cooling property market showed further signs of deterioration.
Data earlier on Wednesday showed the amount of money flowing into China's economy slowed to the lowest level in nearly six year, adding to worries about the outlook.
"The activity figures are basically lower than market expectations, especially the investment data, which is mainly due to the weak showing in the property market," said Zhou Hao, an economist at ANZ in Shanghai.
"I would say the government will have to further relax policies to deliver an annual growth rate of 7.5%."
China's economic growth quickened slightly to 7.5% in the second quarter - in line with the government's full-year target - from 7.4% in the first three months, its weakest pace in 18 months.
But much of the pick-up was attributed to government stimulus, rather than a genuine recovery in momentum.
Industrial output rose 9% in July from a year earlier, the National Bureau of Statistics said on Wednesday, slowing from June's 9.2% gain but in line with market expectations.
Fixed-asset investment, an important driver of economic activity, grew 17% in the first seven months from the same period last year, it said. That compared with a 17.3% rise in the first six months.
The investment figure is closely watched amid the government's push to quicken spending on railway and public housing projects to help offset falling property investment.
Stimulus measures unveiled so far include speeding up the construction of railway projects and public housing, while the central bank has eased monetary conditions by guiding market rates lower and cut reserve requirements for some banks.
Retail sales, a key gauge of domestic consumption, rose 12.2% in July from a year earlier, slowing from June's 12.4% pace.
Economists polled by Reuters had forecast retail sales to rise 12.4%, while fixed-asset investment for the January-July period was seen up 17.4%.
July export growth posted last week was double what markets had expected but imports unexpectedly fell, pointing to weakness in domestic demand. Inflation also remained tame, adding to signs of slack in the economy.
Questions about the durability of the economic recovery flared last week after surveys on service sector activity showed unexpected weakness, linked largely to the housing market downturn.
Real estate investment, which affects more than 40 other sectors from cement to furniture, rose 13.7% in the first seven months from the same period a year ago, slowing from a rise of 14.1% in the first six months.
Sales measured by floor space fell 7.6% from a year ago in the first seven months, while sales revenue fell 8.2%. New construction dropped 12.8%.
