China data shows economic momentum flagging

The Chinese economy is displaying further signs of weakness, with data Tuesday showing the pace of investment slumping to a record low in the first seven months of the year while retail sales growth slowed.

Beijing faces a delicate balancing act, aiming to shift its growth driver away from investment and exports towards personal consumption, while at the same time battling a mountain of debt.

A trade brawl with Washington has added to the difficulties -- the yuan and stock markets have tumbled in recent weeks -- providing relief to exporters but hurting Chinese consumers.

US tariffs on $34 billion worth of Chinese goods, and retaliatory levies from Beijing, came into force in early July, with more tit-for-tat measures due next week.

But the extent of the conflict's impact on China remains unclear, said National Bureau of Statistics spokeswoman Liu Aihua. Trade data last week showed exports holding up in July.

"The negative impact will be gradual, with the impact on the international economy and the global economy already emerging," Liu said.

Output at factories and workshops expanded 6.0 percent on-year in July, in line with June's reading, according to the NBS, but short of the 6.3 percent forecast in a Bloomberg News survey.

Steel production -- a sore spot with the Trump administration -- was especially strong in July with crude output climbing 7.2 percent on-year to a record 81.24 million tonnes as producers ramped up production to take advantage of high prices.

The commodity's price is at a six-year high as expectations for demand pick up and the government's fight against pollution sees a number of plants shuttered.

Retail sales, a key gauge of domestic consumption, rose 8.8 percent on-year in July, down from nine percent in June, and also missing estimates of 9.1 percent growth.