43522
China Growth Heading  Toward Q2 Stability
World Economy

China Growth Heading Toward Q2 Stability

China expects second quarter economic growth to be stable, though exports face pressure from global uncertainties, a spokesman for the statistics bureau said on Monday.
Growth in China’s fixed-asset investment slipped below 10% for the first time since 2000, while retail sales growth also slowed, the National Bureau of Statistics announced earlier in the day, Reuters reported.
Statistics bureau spokesman Sheng Laiyun also said China’s authorities are prepared to deal with a possible US Federal Reserve interest rate increase.
Price data showed consumer inflation cooled, but production price deflation eased markedly, reducing some of the strains on Chinese companies which are battling shrinking profit margins.
Government pledges to cut excess industrial capacity and restructure bloated state-owned enterprises are a major wild card, posing risks to near-term growth and the financial system. But most economists expect Beijing to move slowly, fearing social instability if millions of people are suddenly thrown out of work.
After a bumper March and a disappointing April, economic data for May in China are forecast to show a stable pace of growth, with little impetus to apply fresh policy stimulus.
Credit Rise
A record surge in credit in the first quarter already left China’s leadership with little appetite to step on the monetary accelerator further. President Xi Jinping himself highlighted the importance of deleveraging in remarks publicized in May. For now, with car sales accelerating and imports showing signs of improvement, domestic demand appears to be cooperating.
Industrial output is estimated to have risen 6% in May from a year earlier, according to the median estimate of economists surveyed by Bloomberg, matching the gain for April.
The steady advance in manufacturing, just under official GDP growth rates near 7%, masks a wide gap between some industries and regions that are experiencing outright declines in output, and others that are seeing strength.
  Investment Cools
Growth in China’s fixed-asset investment and retail sales cooled unexpectedly in May, but factory output growth was steady, doing little to clear up uncertainty over prospects for the world’s second-largest economy.
Factory output grew 6% in May from a year earlier, the National Bureau of Statistics said on Monday. Economists polled by Reuters had expected growth to ease slightly to 5.9% from 6% in April.
Analysts believe industrial output has been supported by a government infrastructure spending spree and a further recovery in the property market.
Fixed-asset investment growth fell to 9.6% in January-May from the same period a year earlier, missing market expectations of 10.5%, which would have been unchanged from Jan-April.
Fixed investment by private firms continued to slow. Investment by private firms rose 3.9% year-on-year in January-May, compared to 5.2% growth in the Jan-April.
China’s real estate investment rose 7% in the first five months of 2016 from the same period a year earlier, while property sales by area increased 33.2%.
Retail sales growth in May, which captures both private and government purchasing, slowed to 10% on-year, although the decline was only marginal. Analysts had forecast sales would be unchanged from April at 10.1%.
China’s May power generation was unchanged from April, with January up 0.9%.

  Fiscal Expenditures Soar
China’s fiscal spending soared 17.6% in May from a year earlier, while fiscal revenue rose 7.3%, the finance ministry said on Monday.
For the first five months of this year, fiscal expenditure was up 13.6% compared with the same period in 2015, while fiscal income increased 8.3%. The ministry said in an online statement that downward pressure on the economy still persists and that authorities should pay close attention to changes in economic and fiscal operations.

Short URL : http://goo.gl/r9XyRx
  1. http://goo.gl/Mlen2g
  • http://goo.gl/IM5Y3O
  • http://goo.gl/RmbDJL
  • http://goo.gl/1Koh5S
  • http://goo.gl/KWZBL0

You can also read ...

Lower-income families, already pinching pennies, are most exposed, given the likelihood of tariff-related price increases on everyday items.
China canceled trade talks with the US and will no longer send...
Italy CB Urges Caution on Possible Deficit Hike
The governor of the Bank of Italy urged caution on the nation’...
Turkey, Venezuela Plan to Use Local Currencies
Turkey and Venezuela are eager to use local currencies in...
Japan to Resist New Auto Tariffs
The Japan-US ministerial-level trade talks scheduled on Monday...
Fitch Upgrades India’s Growth Forecast to 7.8%
US multinational Fitch Ratings on Friday raised India’s GDP...
Taiwan Consumers More Upbeat on Economy
Confidence in Taiwan’s economy edged higher in September after...
Pakistan Seeks  to Increase  Exports to China
In a positive development, an important mission from China is...
EU foreign affairs chief Federica Mogherinia (L) and Transport Commissioner Violeta Bulc present the proposal  for an EU strategy for connecting Europe and Asia.
While European Union leaders were in the middle of another...

Trending

Googleplus