Chinese Industrial Output Increases

 Chinese Industrial Output Increases

Chinese Industrial Output Up By 6.7%, Above The Forecast

During April, a 6.7% increase was seen in China's industrial output. A month earlier, the same reading was around 4.5%, which shows a healthy improvement in the manufacturing sector.

According to the data from the NBS, the data was higher than the forecast of 5.5% made by the analysts. However, retail sales declined from 3.1% in March to only around 2.3% in April, while the forecast was 3.8%.

Fixed Asset Investment Up By 4.2%

Another indicator that showed growth was fixed asset investment, which went up by 4.2% during Q1 2024. Conversely, the market was forecasting a reading of 4.6%, while the previous reading was 4.5%.

The overall picture painted by the economic data remains mixed during April. As a result, currencies such as the CNY, AUD, NZD, & a few others will also take cues from the economic situation in China.

Both the imports and exports of China also showed growth during the month, while the earlier reading showed a contraction. At the same time, consumer prices have jumped for the 3rd month in a row.

For the year 2024, the Chinese government has set a growth target of 5%, while the growth rate during Q1 2024 was around 5.3%.

Meanwhile, China has also issued some special treasury bonds worth 1 trillion yuan with really long periods of 20 - 50 years. The country will use these funds to support various sectors of the economy.

If we look at the property sector, it is down by 9.8% y/y from Jan to April, while the decline during Q1 was 9.5%. This reading is also important as the property sector accounts for almost 25% of the economy.

The Chinese authorities are also working on a plan to buy unsold homes, which will help support the property sector. However, the number of these homes is in the millions, which means they will need a lot of money to build them.

The over all picture during April is very mixed for the Chinese economy as some sectors have shown growth while others remain in contraction.

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