China's economy reveals pockets of softness. Here's what to watch ahead of Friday's data

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As China’s economy moves into the second quarter of the year, a few indicators are pointing to sluggish growth ahead if things don’t turn around, raising expectations for monetary policy easing. The People’s Bank of China over the weekend released new loan data for April that pointed to a sharp slump in demand, with several metrics at their lowest in at least two decades. On Friday, China plans to issue its first ultra-long bond — 30 years in term — as Beijing kicks off a previously announced program for a total of 1 trillion yuan ($138.25 billion) in funds for major strategic projects. People purchasing fruit at an agricultural trade market on May 11, 2024 in Lianyungang, Jiangsu Province of China. Vcg | Visual China Group | Getty Images

BEIJING — As China’s economy moves into the second quarter of the year, a few indicators are pointing to sluggish growth ahead if things don’t turn around, raising expectations for monetary policy easing.

The National Bureau of Statistics is due to release data on retail sales, industrial production and fixed asset investment for April on Friday. Analysts polled by Reuters as of Tuesday expect a slight increase compared to March.

The same day, China plans to issue its first ultra-long bond — 30 years in term — as Beijing kicks off a previously announced program for a total of 1 trillion yuan ($138.25 billion) in funds for major strategic projects. The Ministry of Finance has not specified what the first tranche will be used for.

Some of the weakness speaks to genuine sluggish demand in China at present. Goldman Sachs

“With issuances running all the way until November, it is likely some of the proceeds spending (and therefore benefit to the economy) will only feature in H1 next year,” Louise Loo, lead economist at Oxford Economics, said in a note Tuesday.

The firm expects this week’s economic data releases to show a “softening in economic momentum,” affirming its forecasts for the central bank to cut rates by the end of June.

The central government bond program comes as the drag from real estate persists, while businesses and consumers largely remain conservative about spending.

The People’s Bank of China over the weekend released new loan data for

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