No evidence of an impact from recent stimulus measures in China’s July-August investment figures

China’s official economic figures for August show no large changes in economic circumstances relative to previous months. However, while monthly figures show little fluctuation, it seems third-quarter GDP growth will fall well below the growth pace of 3Q17.

Retail sales, a widely-used indicator of services output and consumption, rose in real terms by 6.6 % y-o-y in July-August. The corresponding growth in July-August 2017 was 9.3 %. Figures for goods freight indicate an even sharper slowdown in growth. Industrial output growth appears to have slowed only marginally since July-August 2017, but the lack of almost any fluctuations in official figures over the past three years has also been astonishingly consistent – especially in light of changes in other indictors tied to industrial output. Real on-year growth in fixed asset investment (FAI) has been around zero for over a year. Despite stimulus measures to boost growth, there were no signs yet in July and August of an increase in FAI.

China’s quarterly reporting of on-year GDP growth has fluctuated a mere 0.1 percentage point around the 6.8 % level during the past three years. Third-quarter GDP figures will be released on October 19.