China’s second-quarter slowdown underway amid soft consumption in World Economy News 15/06/2026 Slowdown underway amid soft consumption and investment China’s April data came in well below market expectations. Retail sales slowed to just 0.2% year-on-year in April, the softest month since 2022. Sales look likely to tip into negative territory in May. We are now seeing the negative side of front-loaded consumption from the trade-in programmes of previous years. Beneficiary categories are seeing big year-on-year drops. Investment remains soft, with fixed‑asset investment slipping back into negative growth and new RMB lending continuing to contract – clear signs that firms are still holding back. Elevated uncertainty is likely weighing on investment, but the deeper issue is that, outside strategic sectors like tech and advanced manufacturing, investment appetite has been weak for a long stretch, even with low interest rates. Risks to our full-year growth forecast remain relatively balanced but are more tilted towards the downside than they were a month ago. We’ve likely not yet seen the full impact of higher energy prices on the economy. Higher input prices will likely be passed on to consumers in the coming months. Tighter controls on capital outflows There have been reports of tighter controls out of China over the past month. First, the China Securities Regulatory Commission (CSRC) announced a crackdown on offshore trading platforms popular among Chinese citizens for investing in overseas assets. Second, the State Council published new regulations on outbound investment at the start of June. There will be a greater focus on national security and tighter monitoring and oversight. While outbound investment is still generally encouraged, sensitive sectors will likely be impacted, with controls on tech, data, and talent transfers. This could potentially add a new hurdle for Chinese outbound investment. Policymakers may have tightened controls due to concerns about bubbl