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China’s slowdown worsened in October, dragged by soft consumer demand and a deepening property downturn, with the long holiday period further denting factory activity.

Fixed-asset investment, which includes real estate, contracted 1.7% for the first ten months of the year, steepening from a 0.5% decline in the January-to-September period, data from the National Bureau of Statistics showed Friday. Analysts polled by Reuters had forecast a 0.8% drop.

The last time China recorded a contraction in fixed-asset investment was in 2020 during the pandemic, according to data going back to 1992 from Wind Information, a private database focused on the country.

Industrial output expanded 4.9% in October, a slowdown from a 6.5% rise in the prior month, missing expectations for a 5.5% jump.

China’s manufacturing activity contracted more than expected in October, shrinking to the lowest level in six months, as a weeklong holiday, which stretched from Oct. 1 to Oct. 8, shuttered most factories across the country.

Retail sales climbed 2.9% in October from a year earlier, topping expectations for a 2.8% growth in a Reuters poll, but softening from a 3% year-on-year rise in September.

The survey-based urban unemployment rate ticked down to 5.1% last month from 5.2% in September.

The sharp drop in fixed-asset investment was largely dragged down by lackluster investment in the property sector and infrastructure, according to Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.

Consumer prices rose 0.2% from a year earlier in October, the strongest inflation reading since January this year and the first positive growth since June, according to LSEG data.

The core CPI, which strips out food and energy, rose 1.2% from a year earlier, the highest since February 2024, according to data provider Wind Information.

China’s exports in October unexpectedly contracted for the first time in nearly two years amid a deepening slump in shipments to the U.S. as tensions with Washington over trade escalated before a deal was reached at the month’s end.

U.S. President Donald Trump and Chinese leader Xi Jinping agreed last month to trim their tit-for-tat tariffs and suspend a raft of restrictive measures for one year.

Zhang, however, expects Chinese policymakers to refrain from unveiling further stimulus measures for the remainder of this year, as the economy appears to remain on track to achieve its 5% growth target.

China’s economic growth slowed to 4.8% in the third quarter, following expansions of 5.2% in the second quarter and 5.4% in the first quarter.

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