China’s Economic Distress Deepens as Lockdowns Drag On

HONG KONG—China’s economy descended deeper into a Covid-19-induced doldrums last month, raising questions about whether Beijing’s planned stimulus measures can prevent a prolonged downturn.
Consumer spending and factory output tumbled in April, while growth in infrastructure investment—which Beijing has been counting on to prop up growth this year—slowed sharply, China’s National Bureau of Statistics reported Monday.
China’s headline jobless rate, meantime, surged to a two-year high of 6.1%, further evidence of the economic damage unleashed by the country’s strictest pandemic containment measures in more than two years.
While activity could snap back if lockdowns are ultimately lifted, the damage from China’s commitment to stamping out outbreaks of Covid-19 is rippling through the economy and lingering. The question now is whether policy makers in the world’s second-largest economy will be able to soften the blow with fiscal and monetary policy tools.