Recent calls for fiscal stimulus methods in China have been quieted somewhat following the better-than-expected results of several pieces of key economic data.
For the past three months manufacturing, trade and inflation have cooled and concern regarding the stability of the world’s second largest economy has intensified. But now figures for September have shown increased rapidity in the Asian nation’s retail sales, industrial production and fixed asset investment.
Retail Sales advanced by the most for six months after gaining 14.2 per cent, whilst fixed-asset investment also beat economist’s expectations after showing a 20.5 per cent rise. Meanwhile, industrial production rebounded strongly from Augusts three-year-low by expanding 9.2 per cent from the previous year.
With a once-a-decade leadership change just around the corner these positive figures may mean the Chinese Government can enjoy a brief respite from deciding whether or not to instigate monetary easing.
Further uplifting news came after the Beijing based National Bureau of Statistics reported that China’s gross domestic product in the third quarter expanded 7.4 per cent from a year earlier.
This recorded expansion matched economist’s median forecast and could hint at a growth rebound.
A spokesperson for the statistics bureau said of the news: ‘We can tentatively conclude that the economy is shifting from a state of slowing down to one of bottoming out.’ The bureau also predicted that the fourth quarter should show a modest recovery.
Yesterday the Chinese Premier Wen Jiabao asserted that balance is being restored to China’s economic growth and more ‘positive changes’ are expected.
Meanwhile JP Morgan Chase & Co’s chief China economist commented that ‘China’s economy is performing better than expected, and the bottoming will be clear in the fourth quarter’. Zhu Haibin then went on to state that the likelihood of a further interest-rate cut in 2012 is becoming ‘quite small’.
As of 10.25 am
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