China's Property Sector and Retail Sales Fuel Stimulus Calls

China's property sector continued to weaken in November, with declining home buyer sentiment and indebted developers leading to lower sales and investment. Retail sector activity also fell short of forecasts, indicating the need for further support to boost demand. While industrial output grew faster than expected, analysts remain cautious about the overall economic recovery, citing deepening factory-gate deflation and the need for more effective policy transmission. The patchy recovery and structural slowdown have raised concerns that China may face Japanese-style stagnation unless policymakers prioritize household consumption and market-allocation of resources. Analysts suggest that additional stimulus measures will be necessary to sustain the targeted annual economic growth of around 5% in 2024.