China: Real GDP growth slows further in Q3 – Nomura
|Analysts at Nomura note that the China’s GDP growth slowed by more than the market expected in Q3 to 6.5% y-o-y from 6.7% in Q2 (Consensus 6.6%; Nomura 6.4%).
Key Quotes
“Industrial production (IP) slowed further to 5.8% y-o-y in September from 6.1% in August, while fixed asset investment (FAI) ticked up slightly to 5.4% y-o-y ytd in September from 5.3% in August, suggesting Beijing’s stimulus is starting to have an impact. Nominal retail sales picked up to 9.2% y-o-y in September from 9.0% in August, but in real terms it slowed to 6.4% y-o-y from 6.6%.”
“We believe GDP growth could remain around 6.5% y-o-y in Q4 2018 due to a frontloading of exports (in fear of further tariff hikes in January 2019) and a loosening of restrictions on the anti-pollution campaign this winter, but then it should slow much further in 2019, as the frontloading effect ends.”
“So far, Beijing’s stimulus has been limited in scope and scale but, with the worsening sentiment, tumbling stock markets and rising growth headwinds, we expect Beijing to take more actions.”
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