There a lot of bearish material around the web today on disappointing Chinese growth. And it’s true that compared with past years, April’s figures are unspectacular. But it is also the case that activity is solid, more solid than sentiment suggests. Find two reports below, one from ANZ and the other from Phat Dragon on where growth is at. My take is that we are slogging on around 8% and if anything seeing a broadening of activity.
Industry is recovering solidly:
Retail sales growth looks a little concentrated in jewellery but is still broad based:
Total lending growth was down in April but is still running at a ridiculous pace. From CLSA:
The concerns about the deteriorating quality of Chinese growth, with much more credit needed to support much lower GDP, are real. But the above figures to set us for a couple of good quarters of activity.
I still see Q4 as the denouement for the cycle as real estate curbs kick-in and construction activity begins to fall away.
