Shanghai's Economy Slows As Covid Deals Blow

The economy of Shanghai, the mainland's most populous city, slowed in the first quarter from the end of 2021, hurt by rare declines in industrial output and retail sales that were hammered by the country's most serious Covid outbreak.

Shanghai's gross domestic product (GDP) grew 3.1 percent in the first quarter from a year earlier, the local statistics bureau said on Saturday, significantly less than the 4.8 percent growth in the national GDP during the same period announced earlier. In 2021, Shanghai's GDP rose 8.1 percent.

"In January-February, the city's economic operation was stable, but due to the impact of the Covid outbreak in March, the first quarter was marked by stability followed by a decline," the city's statistics bureau said in a statement.

Shanghai started reporting Covid cases in the latest outbreak in early March, with authorities declaring a lockdown of the entire city of 25 million people in early April when infections escalated.

The economic slowdown in Shanghai is widely expected to have worsened in April.

Output of Shanghai's vast industrial sector plunged 7.5 percent year-on-year in March after stringent lockdown measures halted some production, a city official said on Friday.

For the January to March period, industrial production grew 4.8 percent from a year earlier, the Saturday data showed.

Shanghai's first-quarter retail sales, a key gauge of consumption, fell 3.8 percent year-on-year, swinging from 3.7 percent growth in the first two months.

In March alone, retail sales nosedived by 18.9 percent.

In the first quarter, the city's consumer prices rose 1.8 percent from a year earlier, with prices in January-February up 1.6 percent year-on-year and accelerating in March to a 2.2 percent clip. (Reuters)