The pace of China’s economic expansion unexpectedly cooled further last month after a lackluster July, as factory output, investment and retail sales all slowed.

• Industrial output rose 6.0 percent from a year earlier in August, versus a median projection of 6.6 percent and July’s 6.4 percent
• Retail sales expanded 10.1 percent from a year earlier, versus a projection of 10.5 percent and 10.4 percent in July
• Fixed-asset investment in urban areas rose 7.8 percent in the first eight months of the year over the same period in 2016, compared with a forecast 8.2 percent rise

The continued cooling of the world’s second-largest economy suggests that efforts to rein in credit expansion and reduce excess capacity are hitting home ahead of the key 19th Party Congress in October. Still, producer-price inflation and a manufacturing sentiment gauge both exceeded estimates earlier this month, signaling some resilience.

"The top leadership will likely stick to the current policy of reining in leverage," reducing excess capacity, and keeping broad credit growth on a downward trend, Morgan Stanley chief China economist Robin Xing wrote in a recent note. "The enforcement of regulatory tightening could be strengthened after the Party Congress."