China: less bang for its credit buck
In China, it’s often the case that the numbers themselves are a source of confusion, if not outright disbelief. But sometimes the numbers also speak for themselves. And one in particular is telling: credit intensity.
This measures the amount of credit needed to generate growth, and it has risen rapidly in the past six months to near its highest level. In other words, when it comes to GDP, China is getting less bang from it’s credit buck. Continue reading »
[chart] China GDP: what a 7.7% slowdown looks like
It’s a growth rate that most other countries can barely dream of, but for China, this quarter’s GDP growth is a disappointment.
This chart shows why (after the break): Continue reading »
China’s shark’s fin soup slowdown
Pretty much everyone agrees that China’s Q1 growth figure was a miss. At 7.7 per cent, it sits below consensus (8 per cent) and down from the previous quarter (7.9 per cent).
As you’d expect, analysts have been scrambling to make sense of it all, with reasons given ranging from dead pigs to cold weather. But one thing keeps cropping up: the luxury crackdown. Continue reading »
Chart of the week: uneven economic growth in China’s regions
When looking at Chinese growth, it’s easy to think of the country as one entity, and one figure. Will GDP expand by 8 per cent this year, or “just” 7?
However, China is a bit bigger than just one number. With a fifth of the world’s population in the fourth biggest country by area, distributed over many provinces, growth has been very uneven. Chart of the week takes a closer look at China’s growth by region. Continue reading »
[video] weaning China off credit-fuelled growth
China’s economy has grown at 8 per cent and more each year over the last decade, but much of that has been fuelled by debt. Michael Pettis, professor of finance at Peking University and author of ‘The Great Rebalancing’ explains to emerging markets editor Stefan Wagstyl the problems facing China as it rebalances its economy from one driven by state investment.
Pettis on China: how to spot early signs of economic reform
Will the new government in Beijing launch reforms to rebalance the Chinese economy – or not?
One way to find out is to scan the pronouncements of the Xi Jinping, the new Communist party leader, and his politburo. But that’s not easy, given the walls that surround China’s political elite.
Another way is to look for hints in the economic data. As China-watcher Michael Pettis told beyondbrics, the numbers could begin to reveal signs of change. Continue reading »
China GDP in two charts
If you are perplexed by the seemingly conflicting headlines:
Quarterly Growth Gives China Boost (WSJ)
China records slowest growth for 13 years (FT)
… here are the two charts to help you out. Continue reading »
China’s alternative GDP index – how low did it go?
So there it is. China’s economy is no longer slowing down. Growth in the fourth quarter rose to 7.9 per cent. Hard landing avoided. Hurrah.
For those that panicked last summer over the potential for economic apocalypse on the mainland, the fact that growth stayed above 7 per cent for the duration of 2012 might be a little puzzling. But, look at an alternative take on Chinese growth, and those concerns look more justified. Continue reading »
[snap]: China Q4 GDP grew 7.9%
Rejoice! China’s economy grew 7.9 per cent in the fourth quarter from a year earlier, the National Bureau of Statistics said on Friday.
That’s a hair above the consensus forecast of 7.8 per cent. Both the Shanghai Composite and Hong Kong’s Hang Seng are up.
All eyes on China Q4 GDP
Friday is going to be all about China’s fourth quarter GDP figure.
With growth in the previous quarter having come in at a disappointing 7.4 per cent – the slowest pace in three years – the big question on everyone’s mind will be: has China’s protracted slowdown finally run its course? Continue reading »
China GDP: If not 10%, then what?
If China’s days of growing at 10 per cent are over, what might be a plausible average growth rate for the near future?
Pessimists suggest 6 per cent because of the huge overhang of over-investment that is widespread across different sectors of the economy and the long list of difficult reforms ahead. Standard Chartered’s economist Stephen Green suggests the likely rate over the next five years is 7 per cent without big bang reforms in the interim. Continue reading »
China’s re-emergence as a global economic powerhouse is by now fairly well understood. The country has engaged in a process of economic catch-up similar to that which Japan and Korea achieved in earlier decades, writes Gavyn Davies on his FT.com blog.
The question for the next decade is whether this growth process will prove to be self-limiting. The experience of other Asian economies suggests that, one day, this will indeed happen. The supply of under-employed labour in rural areas will be drained, the growth of manufacturing will peak, and the ability to import superior technology from other economies will run out of rope. A slowdown in growth is therefore inevitable. The only questions are when, and by how much? Continue reading »
China GDP: edging towards recovery?
So is the worst over for the Chinese economy? Figures on Thursday morning showed GDP grew 7.4 per cent in the third quarter from a year earlier – the seventh consecutive quarter of slowing annual growth.
But premier Wen Jiabao cheered the markets when he said, shortly before the figures were published, that the Chinese economy had started to stabilise and predicted it would meet Beijing’s full-year growth target of 7.5 per cent. That helped push the Shanghai stocks up by nearly 1.5 per cent and the MSCI Asia Ex-Japan index by 0.7 per cent. Continue reading »
[video] China GDP: a slower grower
Lex’s Stuart Kirk and Julia Grindell delve deeper into the China GDP numbers to determine how robust the growth in consumption and investment really is.
Deutsche: China’s cheap for a reason
Another growl from Deutsche Bank’s emerging markets bear, John-Paul Smith. This time he’s had a close look at Chinese corporates – and doesn’t like what he sees.
He’s worried about the overcapacity created in the recent huge investment wave, compounded by Beijing’s failure to maintain discipline over its free-spending regions or enforce loudly-touted consolidation plans in key industries, eg steel.
Investors should therefore be wary of the apparent cheapness of Chinese stocks. Far from being a buying opportunity, low prices are signalling “a major break in the growth model”. Caveat emptor. Continue reading »
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