Hong Kong (CNN Business) The trade war might be headed for a slight reprieve, but China is still getting battered by a slowing economy and its standoff with the United States.

Industrial production in China — an important indicator for the country's economy — grew just 4.8% in July compared to a year earlier, according to China's National Bureau of Statistics. That's the worst growth for that sector in 17 years.

The metric is important because it measures the output of key businesses in China's manufacturing, mining and utilities sectors. The latest figure fell far short of the 5.8% that analysts polled by Reuters expected. It's also a big slowdown compared to June's 6.3% growth.

Global markets have rallied on hopes for trade optimism. On Tuesday, the United States announced that it would postpone new tariffs on several categories of Chinese-made consumer goods until December, instead of applying them in September as originally planned.

But there is still pressure building on China regardless.

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