The two big Asian economies have produced a rather mixed bag of economic news with still little evidence of a pick-up in China’s economy, while Japan has surprised with a spurt of export driven growth.
- Japan GDP grows 0.5pc for the quarter, 2.2pc annualised
- China industrial production steady, retails sales growth slows, fixed asset investment up
- “Rebound in private investment” helps drive China
The regular monthly release of key economic data from China’s National Bureau of Statistics showed industrial production grew at an annualised pace of 6.1 per cent in October.
The two big Asian economies have produced a
That was in line with a month earlier, but below expectations given stronger manufacturing surveys recently and the fact it was coming off a low base.
Retail sales were surprisingly weak, growing at 10 per cent over the year, but well down on the 10.7 per cent growth recorded in September.
On the other hand, fixed asset investment (FAI) – which is a proxy for construction and infrastructure spending – held up better than expected, growing at 8.3 per cent in the year-to-date, a marginal acceleration on the 8.2 per cent reported in September.
Capital Economics China economist Julian Evans-Pritchard noted the headline figures for industrial production are probably a bit like GDP data – too stable to be entirely trusted.
However, Mr Evans-Pritchard drew some comfort from underlying data on output volumes.
“Growth in the output of electricity, steel, glass and cement all accelerated last month, car production slowed but there was a pick-up in mobile phone production,” he noted.
With consumption in the retail sector continuing to cool, Mr Evans-Pritchard said the acceleration of FAI to its fastest growth in six months was a positive.
“Although state sector investment remains strongest, much of the recent recovery has come from a marked rebound in private investment, which had stagnated earlier this year,” he said.
Japan’s unexpected surge in growth
The news further east was better with Japan easily beating expectations for third quarter growth.
Japan’s economy grew at 0.5 per cent in the three months to September, more than double analysts’ forecasts.
On an annualised basis, GDP growth hit 2.2 per cent, well ahead of the June quarter’s 0.7 per cent year-on-year growth and the forecasts of 0.9 per cent.
Importantly the jump was driven by the fastest growth in exports seen in more than a year as external demand, particularly for smart-phones and steel, picked up.
The main downside was the still moribund domestic demand, which only eked out marginal growth.
Tags: Capital Economics, cement, China's economic data, China's economy, China's industrial production grew, China’s National Bureau of Statistics, defying expectations for acceleration. (Brett Worthington), domestic demand, economic data from China, electricity, GDP data, glass, Japan GDP grows 0.5pc, Julian Evans-Pritchard, PHOTO: Industrial production growth has remained steady, Retail sales were surprisingly weak, steel, stronger manufacturing surveys