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Cooling economic activity in China paves way for more stimulus

Policy-makers may turn to fiscal stimulus rather than monetary easing

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China’s economic activity cooled in April after a rebound in the first quarter, increasing the likelihood of more stimulus amid worsening trade tensions with the US.

Industrial production dropped to 5.4% growth from one year earlier, the National Bureau of Statistics said on Wednesday (May 15).

The figure is lower than the 8.5% growth recorded in March and the 6.5% consensus polled by Reuters. Total retail sales in April rose 7.2% from a year earlier, the slowest pace in about 16 years.

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