China power output down 3.9 pct in early May-media

BEIJING Mon May 25, 2009 11:50am BST

BEIJING May 25 (Reuters) - The decline in China's power output accelerated in the first 10 days of May to 3.9 percent from a year earlier, the influential Caijing Magazine reported on Monday, providing the latest evidence that the Chinese economic recovery still lacks a solid footing.

The drop was 0.7 percentage points larger than the decline for the last 10 days of April, it said, citing data from the National Electricity Dispatching and Communication Centre, a unit of the State Grid.

Nationwide electricity consumption via major grids had fallen 4.3 percent in the first 10 days of May, also 0.7 percentage points sharper than that for the last 10 days of April, it said, confirming earlier local media reports. The power data is considered by some as more of a leading indicator than manufacturing and export data.

But some analysts cautioned that power use was closely linked to heavy industry and thus not representative of the broader manufacturing sector. China's power output in April fell 3.5 percent from a year earlier, the sixth decline since October, as activity in the world's third-largest economy slowed from the impact of the global financial crisis. (Reporting by Eadie Chen and Tom Miles; Editing by Jacqueline Wong) (eadie.chen@reuters.com; +8610 6627 1268; Reuters Messaging: eadie.chen.reuters.com@reuters.net))