China’s economy at a glance – 13 December 2015
The modest recovery in industry unlikely to continue, China is moving away from the ‘old economy’.
The modest recovery in industry unlikely to continue, China is moving away from the ‘old economy’
- Indicators of China’s industrial sector were somewhat improved in November, with both industrial production and fixed asset investment showing stronger growth following recent lows in September. The pickup in investment came despite a further contraction in real estate investment.
- We don’t anticipate a strengthening in industrial growth to continue – it is worth noting that both major industrial surveys remain in negative territory – as China’s economy continues to transition to consumption based growth.
- Trends in the retail sector remain strong – with real retail sales growth at 11% yoy in November – signalling the stronger performance of China’s services sector. November also saw Singles’ Day – the world’s largest online shopping day, with total sales over six times that of the US Cyber Monday.
- Trade data continued to highlight the weaker industrial growth trends – with both import and export values declining year-on-year. China’s trade surplus was lower in November – due to month-on-month increase in imports – but remained at historically high levels.
- In November, the IMF announced that China’s currency will be included in the Special Drawing Rights basket – commencing in October 2016. Its share – at 10.9% – will be larger than both the Japanese Yen and British Pound in the new basket. It remains to be seen what impact this will have on demand for the Yuan and on global capital flows –however this move may provide a signal of international support for the reform agenda proposed by China’s leadership.
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About the Author
Gerard has over a decade of experience as a professional economist, currently specialising in international economic research. He is responsible for monitoring and forecasting trends in emerging Asian economies, with a particular emphasis on China. He is also a member of the bank’s commodities research team, focusing on trends in iron ore and coal markets.
Gerard joined NAB in 2005, and previously focused on risk analysis across a range of industry sectors in Australia and abroad. He had particular expertise in areas such as Mining, Manufacturing, Healthcare and Retail, including the development of research into online retail sales. Prior to joining NAB, he was an economist with the Australian Bureau of Agricultural and Resource Economics, focusing on commodities and energy research.
He holds Bachelors degrees in Economics (with Honours) and Commerce from the Australian National University.
