Tuesday April 17 2018
China Quarterly GDP Growth Weakest in 2 Years
National Bureau of Statistics l Rida Husna | rida@tradingeconomics.com

The Chinese economy grew by 1.4 percent quarter-on-quarter in the three months to March of 2018, compared to an advance of 1.6 percent in the previous period and slightly below market expectations of 1.5 percent. It was the weakest pace of expansion since the first quarter of 2016.

Year-on-year, the economy advanced 6.8 percent year-on-year in the March quarter 2018, the same pace as in the previous two quarters and matching consensus.

For 2018, the Chinese government targets growth at around 6.5 percent amid efforts to deleverage, contain debt and financial risks. 

In 2017, the economy expanded by 6.9 percent, beating the govermet target of around 6.5 percent and following a 26-year low of 6.7 percent in 2016.




Tuesday April 17 2018
China Q1 GDP Growth Remains Robust
National Bureau of Statistics l Rida Husna | rida@tradingeconomics.com

The Chinese economy expanded by 6.8 percent year-on-year in the first quarter of 2018, the same pace as in the previous two quarters and in line with market expectations. Growth was mainly supported by solid consumption, property investment and exports.

The value added of the primary industry was up by 3.2 percent; the secondary industry by 6.3 percent; and the tertiary industry by 7.5 percent.

Industrial production grew by 6.8 percent in the first quarter. In March only, it rose by 6.0 percent, below market expectations of 6.4 percent and after a 7.2 percent gain in the previous period. It was the smallest increase in industrial production since last August, as output expanded at a softer pace for: textiles (0.8 percent vs 2.8 percent); general equipment (6.8 percent vs 9.1 percent); transport equipment (4.2 percent vs 4.9 percent); machinery (8.4 percent vs 9.4 percent); and power equipment (5.1 percent vs 13.1 percent). In addition, production of non-metal minerals fell 0.8 percent, after a 4.2 percent gain in the previous period. Meawhile, output growth picked up for: chemicals (4.3 percent vs 2.4 percent); ferrous metals (5.2 percent vs 1.7 percent); and communication (12.8 percent vs 12.1 percent).

Retail sales grew 9.8 percent in the first quarter. In March only, retail sales increased 10.1 percent, beating market consensus of 9.7 percent and following a 9.7 percent rise in the previous period. It was the steepest increase in retail trade since last November, as sales rose at a faster pace for: building materials (10.2 percent vs 6.8 percent in January-February); furniture (10.9 percent vs 8.5 percent); home appliances (15.4 percent vs 9.2 percent); personal care (16.9 percent vs 10.1 percent); jewelry (20.4 percent vs 3.0 percent); cosmetics (22.7 percent vs 12.5 percent); and garments (14.8 percent vs 7.7 percent). In addition, sales rebounded sharply for office supplies (12.6 percent vs -0.9 percent). Meanwhile, retail trade growth was unchanged for oil, oil products (at 9.1 percent) and slowed for both automobiles (3.5 percent vs 9.7 percent) and telecoms (1.6 percent vs 10.7 percent).

From January to March, fixed-asset investment increased by 7.5 percent to CNY 1,007.63 billion, compared to a 7.9 percent rise in the first two months of the year and missing market expectations of 7.7 percent. Public investment rose at a softer pace (7.1 percent vs 9.2 percent in January-February) while private investment advanced further (8.9 percent from 8.1 percent). By industry, fixed investment growth eased for agriculture (23 percent vs 25.3 percent); manufacturing (3.8 percent vs 4.3 percent); transport, storage and postal industry (9.7 percent vs 13.4 percent) and water conservancy, environment and public facilities management (13.8 percent vs 16.1 percent). Meanwhile, fixed-asset investment fell strongly for electricity, heat, gas and water production (-8.9 percent vs -6.1 percent).

Figures released earlier showed that China's exports grew 14.1 percent in the first quarter and imports jumped 18.9 percent.

For 2018, the Chinese government targets growth at around 6.5 percent, the same as in 2017 amid efforts to deleverage, contain debt and financial risks. "Trade dispute with the US will not change the stable development of the country’s economy", a spokesman for the National Statistics Bureau/NBS, Xing Zhihong, said in a news conference. "China is fully capable of responding to Sino-US trade frictions, responding to challenges and maintaining sustained and healthy economic development," he added.





Friday April 13 2018
China Unexpectedly Posts Trade Gap in March
Rida Husna | rida@tradingeconomics.com

China reported a trade deficit of USD 4.98 billion in March 2018, compared to a USD 23.56 billion surplus in the same month a year earlier and missing market consensus of a USD 27.1 billion surplus. It was the first trade gap since February last year, as imports surged while exports unexpectedly fell.

Imports soared 14.4 percent year-on-year to USD 179.10 billion in March, beating market consensus of a 10 percent increase, and compared with 6.3 percent growth in February. Imports of commodities continued to lead the way in March, with shipments of copper, crude oil, iron ore and soybeans all rising from the previous month. China's unwrought copper imports rose to 439,000 tonnes from the previous month's 350,000 tonnes and the previous year's 430,000 tonnes. China's crude oil imports climbed to 39.17 million tonnes in March, or 9.22 million barrels per day, the second-highest on record. It compared with 32.26 million tonnes in February and 38.95 million a year earlier. Iron ore imports rebounded 1.8 percent from the previous month to 85.79 million tonnes in March from 84.26 million tonnes in February, but were 10.2 percent below the previous year's 95.56 million tonnes. Soybean imports rose to 5.67 million tones in March from last month's 5.424 million tonnes. Still, they were down 10 percent from last year's 6.327 million tonnes, as demand usually eases after the Lunar New Year festival.

Exports declined 2.7 percent from a year earlier to USD 174.12 billion, missing market expectations of a 10 percent rise, and down from a 44.5 percent surge in February. It was the first drop in exports since February last year due to seasonal factors around the Lunar New Year holiday. Meantime, trade tensions between China and the US have been escalating, after President Donald Trump approved a possible tariff hike on USD 50 billion of Chinese goods. Trump is demanding Beijing take steps to narrow its trade deficit with the US, which stood at a record USD 375.2 billion last year.

The trade surplus with the US, China's largest export market, narrowed to USD 15.4 billion in March from 21.0 billion in February, as exports to the country fell 5.6 percent to USD 30.7 billion while imports grew 3.2 percent to USD 15.3 billion. Also, the trade surplus with the EU was USD 3.6 billion, with exports falling by 7 percent and imports rising by 10 percent; and that with ASEAN countries was USD 3.0 billion, as exports advanced 1.4 percent and imports 13.4 percent. Meanwhile, the biggest trade deficit was recorded with Taiwan (USD 11.4 billion, with exports increasing 8.1 percent and imports 30 percent), followed by South Korea (USD 8.1 billion, with exports falling 4.2 percent and imports increasing 19.1 percent), Australia (USD 5.6 billion, with exports falling 1.3 percent and imports increasing 1.1 percent) and Japan (USD 4.8 billion, with exports falling 3.7 and imports increasing 16 percent).

For the first quarter as a whole, China's trade surplus narrowed 23.2 percent from the previous year to USD 49.12 billion, as exports grew 14.1 percent and imports jumped 18.9 percent. The quarterly trade surplus with the US surged 19.4 percent to USD 58.25 billion, as exports to the country rose 14.8 percent from a year earlier, and imports went up at a slower 8.9 percent.

In yuan-denominated terms, the trade surplus stood at CNY 29.78 billion in March, as exports dropped 9.8 percent while imports rose 5.9 percent. Over the January-March period, the trade surplus shrank 21.8 percent to CNY 326.18 billion, with exports increasing by 7.4 percent and imports by 11.7 percent.





Wednesday April 11 2018
China Inflation Rate Slows to 2.1% in March
Statistics China l Rida Husna | rida@tradingeconomics.com

China's consumer price inflation fell to 2.1 percent year-on-year in March 2018 from a four-and-a-half-year high of 2.9 percent in the previous month and below market consensus of 2.6 percent. Cost increased at a softer pace for both food and non-food products.

The politically sensitive food inflation eased to 2.1 percent in March from 4.4 percent in the previous month, as prices increased at a slower rate for fresh vegetables (8.8 percent from 17.7 percent), fresh fruits (7.4 percent from 8.7 percent) and eggs (17.6 percent from 22.5 percent); while those of pork fell further (-12 percent from -7.3 percent). Meanwhile, cost continued to increase for milk (0.7 percent from 0.4 percent) and tobacco (0.1 percent from 0.1 percent).

Cost of non-food products rose at a softer 2.1 percent, following a 2.5 percent advance in February. Prices increased less for: household goods and services (1.6 percent from 1.8 percent); transport and communication (0.3 percent from 1.5 percent); education, culture & recreation (2.2 percent from 3.7 percent); healthcare (5.7 percent from 6 percent) and other goods and services (1.2 percent from 1.7 percent). Meantime, inflation was steady for clothing (at 1.1 percent) and rent, fuel & utilities (at 2.2 percent).

On a monthly basis, consumer prices declined by 1.1 percent in March, following a 1.2 percent rise in February and way above market expectations of a 0.5 percent fall. It was the first monthly drop since last June.

Meanwhile, the producer price index increased by 3.1 percent from a year earlier in March, easing from a 3.7 percent advance in the prior month and missing market expectations of 3.2 percent. It was the lowest producer inflation since October 2016, as cost of means of production rose at a softer pace (4.1 percent from 4.8 percent in February), namely extraction (5 percent from 6.4 percent), raw materials (5.1 percent from 5.9 percent) and processing (3.7 percent from 4.2 percent). Also, consumer goods inflation eased to 0.2 percent in March from 0.3 percent in the previous month, due to a slowdown in daily use goods (0.9 percent from 1.1 percent) and clothing (0.3 percent from 0.5 percent) and a decline in consumer durable goods (-0.3 percent from -0.1 percent). Food production prices were unchanged for the third consecutive month. On a monthly basis, producer prices fell by 0.2 percent in March, following a 0.1 percent drop in February.





Friday March 09 2018
China Inflation Rate at Over 4-Year High of 2.9%
Statistics China l Rida Husna | rida@tradingeconomics.com

China's consumer prices rose by 2.9 percent year-on-year in February of 2018, after a 1.5 percent rise in the prior month and above market consensus of 2.5 percent. It was the highest inflation rate since November 2013, as cost of food rebounded sharply and cost non-food rose faster.

In February, the politically sensitive food prices increased by 4.4 percent, rising for the first time since January 2017 and reversing 0.5 percent decline in the prior month. Prices surged for fresh vegetables (17.7 percent from -5.8 percent in a month earlier) and rose at a faster pace for eggs (22.5 percent from 14.2 percent) and fresh fruits (8.7 percent from 6.4 percent). Meantime, cost continued to increase for milk (0.4 percent from 0.9 percent) and tobacco (0.1 percent from 0.1 percent). In contrast, cost of pork continued to fall (-7.3 percent from -10.6 percent).

Cost of non-food rose at a faster 2.5 percent (from 2.0 percent in January). Prices increased at a faster rate for: household goods and services (1.8 percent from 1.5 percent); transport and communication (1.5 percent from 0.2 percent); education, culture & recreation (3.7 percent from 0.9 percent) and other goods and services (1.7 percent from 1.2 percent). Meanwhile, cost went up at a softer pace for: clothing (1.1 percent from 1.4 percent); rent, fuel & utilities (2.2 percent from 2.7 percent) and healthcare (6.0 percent from 6.2 percent). Cost of consumer goods grew 2.5 percent (1.0 percent in December) and those of services were up 3.6 percent (from 2.3 percent).

On a monthly basis, consumer prices increased by 1.2 percent, much faster than a 0.6 percent gain in the preceding month and above estimates of a 0.8 percent rise. It was the highest monthly figure since February 2016.

The producer price index increased by 3.7 percent from a year earlier in February, the least since November 2016, and compared to a 4.3 percent rise in the prior month and markets estimates of a 3.8 percent gain. Still, it was the 18th straight month of rise in producer inflation.  Cost rose at a softer pace for means of production (4.8 percent from 5.7 percent in January) namely extraction (6.4 percent), raw materials (5.9 percent) and processing (4.2 percent). Meantime, inflation was steady for consumer goods (0.3 percent) namely daily use goods (1.1 percent), clothing (0.5 percent) while food production was flat. At the same time, prices of consumer durable goods continued to decline (-0.1 percent from -0.3 percent in the prior month). On a monthly basis, producer prices fell by 0.3 percent, following  a 0.3 percent gain in January.


Thursday March 08 2018
China Unexpectedly Posts Trade Surplus in February
Rida Husna | rida@tradingeconomics.com

China unexpectedly reported a trade surplus of USD 33.74 billion in February of 2018, compared to a USD 0.1 billion gap in the same month a year earlier while markets estimated a USD 2.3 billion deficit. Exports jumped by 44.5 percent year-on-year to USD 171.6 billion while imports rose 6.3 percent USD 137.9 billion.

In February, exports soared 44.5 percent from the previous year to USD 171.6 billion, far above estimates of a 13.6 percent growth and after a 11.1 percent increase in a month earlier. It was the strongest rise in outbound shipments in three years. Sales of steel rose to 4.85 million tonnes from 4.65 million tonnes in the preceding month.

Imports increased by 6.3 percent  to USD 137.9 billion, below consensus of a 9.7 percent rise and following a 36.8 percent growth in January. Amid the week-long Lunar New Year holiday, purchases fell for: copper (352 million tonnes from 440 million tonnes in January); crude oil (32.26 million tonnes from 40.64 million tonnes); iron ore (84.72 million tonnes from 100.34 million tonnes) and soybeans (5.42 million tonnes from 8.48 million). In addition, inbound shipments of coal were recorded at 20.9 million tonnes, the lowest since July 2017. 

The trade surplus with the US, China's largest export market, narrowed slightly to USD 21.0 billion from 21.9 billion in January. 

Considering January-February combined, the trade surplus came in at USD 54.3 billion, an increase of 43.6 percent from January-February 2017 combined. Exports in the period grew by 24.4 percent, much higher than a 4 percent growth in the same period a year earlier. Imports advanced 21.7 percent. The January-February trade surplus with the US stood at USD 42.9 billion.

In yuan-denominated terms, the trade surplus was at CNY 224.9 billion in February. Exports jumped by 36.2 percent year-on-year, after a 6 percent rise in January. Purchases declined by 0.2 percent, compared to a 30.2 percent gain in a month earlier. Over the January-February period combined, the trade surplus came in at CNY 362.2 billion, with exports increasing by 18 percent year-on-year while imports growing by 15.2 percent.

Trade in January and February can be distorted by the Lunar New Year holiday, with business slowing down weeks ahead of time and companies scaling back operations. This year, the holiday fell on February 16th.


Friday February 09 2018
China Inflation Rate at 6-Month Low of 1.5% in January
Statistics China l Rida Husna | rida@tradingeconomics.com

China's consumer prices rose by 1.5 percent year-on-year in January of 2018, after a 1.8 percent rise in the prior month and matching market consensus. It was the lowest inflation rate since July 2017 as cost of non-food grew at a slower pace and cost of food fell further.

In January, the politically sensitive food prices declined by 0.5 percent (from -0.4 percent in the prior month), while non-food cost rose at a softer 2.0 percent (from 2.4 percent). Cost of consumer goods went up 1.0 percent (from 1.1 percent) and those of services increased by 2.3 percent (from 3.0 percent). 
Among food, prices dropped for: pork (-10.6 percent from -8.3 percent) and fresh vegetables (-5.8 percent from -8.6 percent). In contrast, prices rose for: eggs (14.2 percent from 11.4 percent); milk (0.9 percent from 0.6 percent), fresh fruits (6.4 percent from 6.3 percent) and tobacco (0.1 percent from a flat reading in December 2017).
For non-food, prices increased at a slower pace for most categories: rent, fuel & utilities (2.7 percent from 2.8 percent); household goods and services (1.5 percent from 1.6 percent); transport and communication (0.2 percent from 1.2 percent); education, culture & recreation (0.9 percent from 2.1 percent); healthcare (6.2 percent from 6.6 percent) and other goods and services (1.2 percent from 1.9 percet). Meantime, cost went up more only for clothing (1.4 percent from 1.3 percent).
On a monthly basis, consumer prices increased by  0.6 percent, following a 0.3 percent gain in the preceding month and slightly below estimates of a 0.7 percent rise. It was the highest monthly figure in a year.

The producer price index increased by 4.3 percent from a year earlier in January 2018, compared to a 4.9 percent rise in the prior month, while markets estimated a 4.4 percent gain. It was the 17th straight month of rise in producer prices but the smallest since November 2016. Cost rose less for means of production (5.7 percent from 6.4 percent in December), namely extraction (6.8 percent), raw materials (7.3 percent) and processing (4.9 percent). Also, prices rose at a softer pace for consumer goods (0.3 percent from 0.5 percent) namely daily use goods (1.4 percent); clothing (0.8 percent), while food production was flat. At the same time, prices of consumer durable goods declined at a faster 0.3 percent (from -0.2 percent  in the prior month). On a monthly basis, producer prices rose 0.3 percent, following  a 0.8 percent gain in December 2017.


Thursday February 08 2018
China January Trade Surplus Smaller than Expected
Rida Husna | rida@tradingeconomics.com

China's trade surplus narrowed sharply to USD 20.34 billion in January 2018 from USD 50.21 billion in the same month a year earlier and way below market consensus of USD 54.1 billion. It was the smallest trade surplus since a rare deficit in February 2017, mainly due to a jump in imports.

Imports jumped 36.9 percent from a year earlier to USD 180.2 billion in January, easily beating market expectations of a 9.8 percent advance and after 4.5 percent in December. Purchases of crude oil hit a record volume of 40.64 million tonnes, compared with 33.7 million tonnes in December, following China's decision to raise its 2018 crude oil import quota for the country's independent refiners by 55 percent over 2017. In addition, imports of iron ore went up 19 percent to 100 million tonnes, the second highest level on record, ahead of the lifting of steel production curbs next month; and purchases of coal rose to a four-year high of 27.81 million tonnes, compared with 22.74 million a month earlier, as heavy snow storms across the country boosted demand at utilities. On the other hand, China's unwrought copper imports fell for a second straight month to 440,000 tonnes in January from December's 450,000 tonnes. Also, imports of gas stood at 7.77 million tonnes, slightly below December's figure of 7.89 million tonnes; and imports of soybeans were at 8.48 million tonnes, down from 9.55 million tonnes in the preceding month.

Exports rose 11.1 percent to USD 200.5 billion, picking up from a 10.9 percent gain in December and also beating market consensus of 9.6 percent. However, Chinese steel exports fell by 18 percent from the previous month and by 37 percent from a year ago to 4.65 million tonnes, the lowest since February 2013.

The trade surplus with the US, China's largest export market, narrowed to USD 21.9 billion from 25.6 billion in December, as exports to the country rose 11.1 percent to USD 37.6 billion while imports grew 26.4 percent to USD 15.7 billion. Also, the trade surplus with the EU was USD 9.9 billion, with exports rising by 10.3 percent and imports by 44.6 percent; and that with ASEAN countries was USD 2.5 billion, as exports advanced 18.4 percent and imports 48.3 percent. Meanwhile, the biggest trade deficit was recorded with Taiwan (USD 10.5 billion, with exports increasing 25.4 percent and imports 41.6 percent), followed by South Korea (USD 8.2 billion, with exports increasing 9.2 percent and imports 28.6 percent), Australia (USD 5.4 billion, with exports increasing 0.1 percent and imports 11.7 percent) and Japan (USD 1.5 billion, with exports increasing 1.4 and imports 37.3 percent).

In yuan-denominated terms, the Chinese trade surplus shrank 59.7 percent from a year earlier to CNY 135.8 billion, as imports surged 30.2 percent to CNY 1.19 trillion while exports increased at a slower 6 percent to CNY 1.32 trillion.

Trade in January and February can be distorted by the Lunar New Year holiday, with business slowing down weeks ahead of time and companies scaling back operations. This year, the holiday falls on February 16th.



Thursday January 18 2018
Chinese GDP Grows 6.9% in 2017
Joana Taborda | joana.taborda@tradingeconomics.com

The Chinese economy expanded 6.8 percent year-on-year in the last quarter of 2017, the same as in the previous three months and beating market expectations of 6.7 percent. Considering full 2017, the economy grew 6.9 percent, well above the official target of near 6.5 percent and a 26-year low of 6.7 percent in 2016. Strong growth in industry and exports and a resilient property market were the main drivers of the expansion. For 2018, the Chinese government targets growth at around 6.5 percent, the same as in 2017 amid efforts to deleverage, contain debt and financial risks.

Considering the fourth quarter of 2017, the primary sector expanded 4.4 percent; the secondary 5.7 percent and the tertiary 8.3 percent. On a quarter-on-quarter basis, the GDP advanced 1.6 percent, below an upwardly revised 1.8 percent in the previous three months and the lowest since the first three months of 2017.
 
Considering full 2017,  agriculture went up 3.9 percent, namely production of food (0.3 percent from 2016); cotton (2.7 percent); pork, beef, mutton and poultry (0.8 percent).
 
Industrial output rose 6.6 percent, 0.6 percentage point faster than in 2016. Manufacturing advanced 7.2 percent and electricity, thermal power, gas and water supply 8.1 percent while the mining sector shrank 1.5 percent. The value added of the high-tech industry and equipment manufacturing increased by 13.4 percent and 11.3 percent respectively.
 
The services sector increased 8.2 percent, 0.1 percentage point faster than in 2016.
 
On the expenditure side, final consumption accounted for 58.8 percent of the GDP, with retail sales rising 10.2 percent.
 
Capital formation accounted for 32.1 percent of the GDP with property investment jumping 7 percent, 0.9 percentage point faster than in 2016 and the highest growth since 2014. Investment in residential buildings increased 9.4 percent and in commercial buildings 7.7 percent. On the other hand, fixed asset investment went up 7.2 percent, 0.9 percentage point slower than in 2016 and the lowest growth rate since 1999. Investment rose faster in the high-tech industry (17 percent, 2.8 percentage point higher than in 2016) and equipment manufacturing (8.6 percent, 4.2 percentage points faster in 2016) while investment in energy-intensive manufacturing decreased by 1.8 percent. Private investment went up 6 percent, 2.8 percentage points faster than in 2016 and accounted for 60.4 percent of total investment. Investment by the state holding enterprises rose 10.1 percent.
 
Total trade jumped 14.2 percent, ending two years of declines. Exports increased 10.8 percent and imports 18.7 percent. 


Thursday January 18 2018
China Economy Grows 1.6% QoQ in Q4
National Bureau of Statistics l Rida Husna | rida@tradingeconomics.com

China's gross domestic product grew by 1.6 percent on quarter in the three months to December of 2017, easing slightly from an upwardly revised 1.8 percent expansion in the previous period and matching market expectations. It was the weakest quarterly growth rate since the first quarter of the year.

Year-on-year,  the economy expanded an annual 6.8 percent, the same as in the prior quarter and slightly above market consensus of a 6.7 percent growth.

For full 2017, the economy grew by 6.9 percent, beating the govermet target of around 6.5 percent and after a 26-year low of 6.7 percent in 2016.