Total spending decreased 0.3% in September.
Insight
The cooler economic conditions experienced in the third quarter could continue into Q4 and further into 2015, reflecting the continued reluctance of Chinese policy makers to implement broad based stimulus. China’s industrial production growth also slowed slightly in October.
The cooler economic conditions experienced in the third quarter could continue into Q4 and further into 2015, reflecting the continued reluctance of Chinese policy makers to implement broad based stimulus.
Bloomberg reported comments from a PBoC monetary policy advisory committee member who suggested fourth quarter GDP would slow to 7.2% yoy – a view broadly consistent with our forecasts.
President Xi Jinping commented at the APEC CEO Summit earlier this month that 7% growth would continue to rank China as one of the world’s fastest growing economies – potentially indicating a lower official growth target in 2015. We forecast economic growth at 7.0% in 2015 and 6.8% in 2016.
China’s industrial production growth slowed slightly in October – with output growing by 7.7% yoy (down from 8.0% in September). While this growth was stronger than the level recorded in August (6.9% – the slowest growth rate in over five years), it remains relatively weak for the post GFC period.
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