it seems to be doing so sooner than expected

“Production momentum is slowing, and with the index coming in below expectation for
a fourth month in a row, it seems to be doing so sooner than expected,” said Goldman Sachs economist Chiwoong Lee in a note to clients.
Is it correct to call the bold a sentence? It seems to me that it it correct because it have both subject and a main verb.
What does the bold mean?
Does it mean that it is happening sooner than expected?

It means that production momentum seems to be slowing sooner than expected.

The bold part could be a sentence in some other context, but it is not a sentence here. Here it is part of a larger sentence.

Thanks Dozy,
I really appreciate it.

“it seems to be doing so sooner than expected”
I want to ask you about " doing so" in the above phrase. Is “to do so” a set expression to express what has just been mentioned?

Is it because the phrase doesn’t end with a full stop?
Is it usually correct to use a phrase that has both subject and verb like that to complement a larger sentence?

Right, “to do so” means to do something that has just been mentioned, or something that is obvious from context.

Sentences start with a capital letter and terminate with a full stop (or exclamation mark or question mark). Your bold text does not follow the termination of a previous sentence, does not start with a capital letter, and does not end with a full stop. Therefore it is not a sentence.

Yes, it is common. If you take out the parenthetical “with the index coming in below expectation for a fourth month in a row” you are left with “Production momentum is slowing, and it seems to be doing so sooner than expected” which is just two clauses joined by “and” (fundamentally no different from “The sky is blue and the sea is green”, or whatever).

Thanks Dozy for the detail explanation!