Chinese exports grew in May at a rate more than double that estimated by analysts, while industrial production and retail sales fell short of expectations. The data explains the cut the central bank's key rate by 25 basis points (first time in three years) which aims to contain the slowdown in the domestic economy.
The data of the trade balance have in fact shown a surplus of $18,7 billion in May, against the 18,4 billion of the previous month and greater than the expectations which predicted a drop in the surplus to 16,15 billion. It was the surprise export growth of 15,3% in May (y/y), when the expected average was +7,1%. Imports increased by 12,7% (basically) against an estimate of +5,5%.
La industrial production, instead, he recorded, for the second consecutive month, growth of less than 10%. In May it grew by 9,6%, on a trend basis, when analysts were expecting a +9,9% after the +9,3% recorded in April. The Retail sales marked at least a six-year low (without calendar effect): +13,8% annually. In April, retail sales had increased by 14,1% and in the first quarter overall by 14,8% in the first quarter.
They grow, but at the lowest pace since 2001, investment in China's urban areas, which contribute to creating more than half of the country's GDP through the construction of infrastructure: in the first five months of the year, these investments grew by 20,1% (y/y), against +20,9% in the first quarter.
The European debt crisis has not yet managed to inflict a severe blow on global trade: the Asian giant's higher exports and imports confirm and lend support to Premier Wen Jiabao's proposal to adopt more stimuli to stimulate domestic demand. According to the US bank HSBC, the government could accelerate tax cuts and speed up spending on public works to ensure growth of more than 8,5% in the second half.
In fact, the macroeconomic data are not entirely encouraging. The Chinese GDP increased by 8,1% in the first quarter (y/y) but, according to JP Morgan, it could slow down to +7,7% in the three months from April to June. The American investment bank has estimated that China will grow by +2012% in all of 7,7: it would be the lowest level since 1999. Yet Wen Jiabao was also quite pessimistic, declaring a 2012 growth target of 7,5, XNUMX%. Inflation fell to 3% in May, the lowest value for two years, against 3,4% in April and below the Government's target of 4%.
Monetarily, the mass M2, the largest measure of the money supply, increased by 12,9% while new yuan loans reached 700 billion (about 110 billion dollars), compared to 681,8 billion in April and 551,6 billion in May 2011.
But buying Petroleum achieved the record and theimport of iron material it was the largest in the last three months: China is slowing down, but still not stopping.
