China's Jan-Feb property investment accelerates despite cooling sales

China industrial output growth falls to 17-year low but investment picks

Data released on Thursday showed that refineries' output in China in the first two months of 2019 increased by 6.1 percent compared to past year based on a daily basis record because the emerging privately owned refineries started the operations of their processing facilities.

China combines January and February activity data in an attempt to smooth distortions created by the long Lunar New Year holidays early each year, but some analysts say a clearer picture of the economy's health may not emerge until first-quarter data is released in April.

China's refiners processed 102.49 million tonnes of crude oil during January and February, according to the data from the National Bureau of Statistics (NBS).

Industrial output rose 5.3 percent in January-February, less than expected and the slowest pace since early 2002.

But investment picked up speed as the government fast-tracked more road and rail projects, offering some relief for policymakers as they work to avert a sharper slowdown, data showed on Thursday.

In particular, Capital Economics and others noted that infrastructure investment has not improved as much as hoped after the government began fast-tracking road and rail projects previous year, raising the risk of a milder-than-expected bounce in construction when work resumes in warmer weather.

In January and February auto sales continued to fall and manufacturing activity sunk.

Fixed-asset investment rose 6.1% in the first two months, from 5.9% in 2018.

Pressured by weak demand at home and overseas, China's industrial output rose 5.3 percent in January-February, less than expected and the slowest pace since early 2002.

Benchmark rebar prices on the Shanghai Futures Exchange have climbed 10 percent in the past two months and hit a peak of 3,908 yuan ($582.82) a tonne on February 11, the highest level since late August.

But fixed-asset investment rose 6.1 percent, while retail sales rose 8.2 percent, both more than expected.

Real estate investment, which mainly focuses on the residential sector but also includes commercial and office space, is a key driver of growth for the world's second-largest economy.

Data on Thursday showed China's property investment quickened in the January-February period driven by strong demand in smaller cities.

Xining, the capital of Qinghai province in central China by the Tibetan Plateau, was the top performer last month with a monthly price increase of 2.3 percent.

But sales of appliances and furniture softened considerably early in the year, possibly linked to a 3.6 percent drop in home sales.

But it still remains well below the near 20% growth seen for many years.

On an annual basis, home prices rose 10.4 percent in February, accelerating from a 10.0 percent gain in January.

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