China’s economic recovery stalled slightly in May, with most industrial output components showing slower growth than in April, and the auto sector providing some unexpected support. Deflationary signals deepened and appeared broad-based, while exports were more resilient than expectations due to shipments of personal electronics and medical goods. Property sector indicators continued recovering in May, but sales growth was confined to tier-2 provincial capital cities, not the smaller cities that are more important drivers of overall construction activity.
