BEIJING, CHINA / RankWire.AI / – In the first seven months of 2026, China’s fixed-asset investment experienced a year-on-year decrease of 6.7%, indicating a deepening slowdown across domestic investment sectors. According to the National Bureau of Statistics, total investment excluding rural households reached 26.03 trillion yuan from January through July, with a 1.42% drop in July compared to June. During that month, both industrial output and retail sales showed signs of deceleration. These figures come on the heels of a slower economic expansion in the second quarter.
The property sector continued to be the primary obstacle to investment growth, with property development expenditure decreasing by 19.2% over the seven-month period. Infrastructure investment contracted by 3.6%, and manufacturing investment fell by 1.7%. Private sector investment declined by 9.4% compared to the same period last year. Despite this, investment excluding real estate development still decreased by 3.7% year-on-year. The data reflected broad declines across key areas of capital expenditure, underscoring the ongoing downturn in the property market.
In July, retail sales of consumer goods increased by 0.6% year on year, totaling 3.90 trillion yuan, marking a slowdown from June’s growth of 1.0%. Industrial output grew by 4.5% in July, down from 5.3% in the previous month. For the first seven months, industrial production rose by 5.3% compared to the same period in 2025. The manufacturing purchasing managers’ index (PMI) stood at 49.2 in July, a decline from 50.3 in June, indicating a slowdown in manufacturing activity.
Broader decline in investment extends beyond the property market
The overall contraction in investment widened during the second quarter and continued into July. After falling 1.6% in the first four months and 4.1% through May, fixed-asset investment decline reached 5.7% in the first half of the year and expanded further to 6.7% through July. Property-related indicators also remained weak, with the floor space of newly constructed commercial buildings sold dropping by 11.8%, and sales by value decreasing by 13.1% to 4.27 trillion yuan.
Nevertheless, some sectors saw growth despite the overall decline. Investment in high-tech industries increased by 5.0% during the first seven months. Investment in information services surged by 19.2%, aerospace vehicle and equipment manufacturing rose by 12.3%, electronic and communication equipment manufacturing grew by 7.1%, and investment in intellectual property products increased by 9.1%. During January to July, high-tech manufacturing output grew by 13.8%, while equipment manufacturing output rose by 9.7%.
Trade growth outpaces some domestic economic indicators
Foreign trade continued to outpace several domestic metrics, with China’s total goods imports and exports reaching 30.13 trillion yuan in the first seven months, representing a 17.3% increase. Exports rose by 14.0% to 17.44 trillion yuan, and imports increased by 22.0% to 12.69 trillion yuan. In July alone, exports grew by 17.8% compared to the same month last year, while imports advanced by 21.2%. Online retail sales of goods and services also climbed by 4.8% through July.
China’s gross domestic product expanded by 4.7% year on year in the first half of 2026, but the growth slowed to 4.3% in the second quarter from 5.0% in the first quarter. Consumer prices increased by 0.5% year on year in July, while the surveyed urban unemployment rate held at 5.2%. The Communist Party Politburo issued a call in late July for enhanced counter-cyclical measures and efforts to boost domestic demand, following the slowdown in investment, consumption growth, and industrial activity.