The latest data failed to match the strength of export numbers released this week, muddying the outlook for the world’s second-biggest economy just as Chinese leaders meet to discuss targets including next year’s growth goal. Central bank data on loans, credit and money supply due as soon as today will be the final key readings for November.
“A modest slowdown in investment and industrial production may lead to a little softening of growth in the coming months,” said Gao Shanwen, Beijing-based chief economist with Essence Securities, a Chinese government-backed brokerage. At the same time, the indicators show China’s economy is generally stable, he said.
China’s economy expanded 7.8 percent in the third quarter from a year earlier, rebounding from a slowdown in the two preceding periods. Analysts surveyed by Bloomberg News last month see growth easing to 7.6 percent this quarter and 7.5 percent in 2014, based on median estimates.
While the increase in exports topped projections from 41 of 42 analysts surveyed by Bloomberg News, the data triggered speculation among some analysts that capital flows disguised as trade could be boosting the export numbers, a practice that authorities tried to crack down on in May. Today’s data show the previously reported export growth was inflated because the industrial-production figures indicate goods for export advanced only 5.8 percent, Zhang said.
While retail sales suggest “improved consumption,” a broader look at the data points to a slowing economy, Dariusz Kowalczyk, Hong Kong-based strategist at Credit Agricole CIB, said in a note.
Bank of America Corp. had a different interpretation of today’s figures, saying economic growth this quarter is “very likely” to exceed the bank’s 7.7 percent forecast. The slowdown in industrial production gains resulted from a comparison with a “strong rebound” at the end of last year, economists led by Lu Ting in Hong Kong wrote in a report.
China’s gross domestic product is expected to rise 7.5 percent in 2014, the Chinese Academy of Social Sciences, a government researcher, said in an annual forecast today in Beijing. Retail sales will rise 13.1 percent in 2014, the organization said.
