China: August’s activity data point to significant downside risks - ANZ
|Zhaopeng Xing and Raymond Yeung, Analysts at Australia and New Zealand (ANZ) Group offer a quick reaction to the disappointing China macro data released earlier today.
Key Quotes:
“Today’s weak data print falls short of expectations, and signals that China’s domestic consumption is not yet ready to be the key economic growth engine, as the growth in real retail sales (deducted price factors) fell to 5.6% y/y in August, lower than the real GDP target.
China’s FAI also retreated to 5.5% in August, pointing to underlying weakness in the manufacturing sector even as infrastructural investment growth quickened 0.4% to 4.2% for the January to August period.
The prospects of an industrial recession pose significant downside risks to China’s GDP growth in Q3, prompting further expectations of more monetary and fiscal policy measures ahead.”
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