China Three things in China

Economics Research 23 August 2026 | 11:29PM HKT

Three quick highlights from China: Hui Shan | Goldman Sachs (Asia) L.L.C. n Weaker July activity data: China’s July activity data slowed from June and missed market expectations. Industrial production growth fell from 5.3% to 4.5% yoy, retail sales growth edged down from 1.0% to 0.6% yoy, and fixed asset investment growth declined from -5.7% to -6.2% ytd yoy. Among major indicators, infrastructure investment decelerated the most, from -9.4% yoy in June to -16.4% yoy in July. The slowdown in services retail sales from above 5% yoy in early 2026 to 3.2% yoy in July is the most concerning, as it suggests that previously resilient sectors are also softening.

July activity data weakened across the board

June Actual -4 -4 July Bloomberg Consensus

-8 -8 Industrial Production Retail Sales Fixed Asset Investment (ytd)

Source: Bloomberg, Haver Analytics, Goldman Sachs Global Investment Research

n Fiscal tightening continued in July: Despite weaker activity, July tax revenue jumped 13.9% yoy, likely reflecting stepped-up collection efforts. Combining the general budget and government-managed fund, revenue growth was +6.9% yoy while expenditure growth was -4.4% yoy, indicating continued fiscal tightening. The July Politburo meeting on July 30, the State Council plenary session on August 17, and the Ministry of Finance press conference on August 21 all pledged to accelerate fiscal spending. We will watch closely the pace of government bond issuance and any signs that the “new policy-based financial instrument” is being deployed in the coming month.

n House price declines moderating: The NBS 70-city new home prices showed slightly smaller sequential declines in July. Shanghai, Hangzhou, and Hefei continued to see year-over-year gains in new home prices. In the existing home

Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to

market, both the NBS 70-city index and third-party data suggest that price declines have moderated in recent months. Over the past few weeks, Beijing has removed certain home purchase restrictions, and the State Council has relaxed rules on Housing Provident Fund use. We think the impact of these marginal easing measures on nationwide property prices is likely limited.

Existing home price declines moderated in recent months

Beike suspended the release of secondary home price data in October 2023, Guoxinda suspended its price series in December 2023, and Zhuge suspended its 100-city property price series in December 2025.

Source: NBS, Centaline, Beike, Zhuge, Wind, Data compiled by Goldman Sachs Global Investment Research

Recent GS China macro research

Asia Economics Analyst: China’s Broad-Based Export Strength to Persist Despite Limited AI Boost, 23 August 2026

China Matters: From Weak to Weaker, 21 August 2026

Asia in Focus: China Retail Sales: Policy Tailwinds Fade, H2 Growth Likely Remains Low, 14 August 2026

Asia Economics Analyst: A Historic Opportunity for RMB Bond Internationalization?, 9 August 2026

Global Markets Daily: China’s Balancing Act Needs a Stronger Yuan and Stronger Demand, 5 August 2026

China: Strong fiscal revenue and slower spending led to a narrower deficit in July, 21 August 2026

China Economic Activity and Policy Tracker: August 21, 21 August 2026

China: SAFE data suggest modest FX inflows in July, 18 August 2026