central bank of china unexpectedly cut interest rates after data showed its retail sales and manufacturing output grew less than expected, signaling that central bankers want to avoid an economic slowdown in China, the world second economy.

Retail sales rose 2.7% in China in July against expectations for growth of 5%, while industrial production rose 3.8%, below expectations of 4.6%. Retail sales and industrial production slowed from the previous month. According to a government spokesperson, “the momentum of the economic recovery has slowed. Further efforts are needed to consolidate the foundations for economic recovery.

The slowdown comes in the wake of China’s “zero COVID” approach to containing COVID-19 with local lockdowns and amid a property downturn. Oil prices fell on slower-than-expected economic data, with light sweet crude down 5% below $90 a barrel.

Retail sales data could signal trouble ahead for You’re here and GM. Tesla generated about 26% of its sales in China last year, while GM generated about 11% of its sales in the country. China is the world’s largest market for electric vehicles.

Industrial production data could also impact industrial giants like 3M and Caterpillar. 3M makes 11% of its total sales in China. Caterpillar does not provide its sales figures for China, but makes about 20% of its sales in Asia.

“The Chinese economy appears to be suffering from a crisis in consumer and business confidence. Retail sales, industrial production and investment are slowing, and the unemployment rate for young workers is close to 20%. This will have a big impact on China’s national economy and its trading partners in the future,” said Caleb Silver, Editor-in-Chief of Investopedia.