25 Sep 2013
Private surveys put official Chinese data further into doubt
FXstreet.com (London) - As is almost always the case, there is something of a wide diversion between official Chinese macro data and that published by private surveys.
Numbers from China Beige Book shows that growth in manufacturing weakened in the last quarter, with a slowdown in transport, business investment and real estate growth.
The report compiled by the private New York-based company is modelled on the US Fed’s Beige Book business survey
In a statement, China Beige Book President Leland Miller said that the results show: “the conventional wisdom of a renewed, strong economic expansion in China to be seriously flawed,” adding that surveys "reveal weakening gains in profit, revenues, wages, employment and prices, all showing slipping growth on-quarter – no disaster, but certainly not the powerful expansion suggested by the consensus narrative."
Earlier this month, China’s statistics-bureau chief Ma Jiantang said the agency has “zero tolerance” for falsified data after it publicised cases of manipulated local data and fraudulent export invoices. Jiantang highlighted the changes in Chinese reporting procedures, with raw data from enterprises going directly go to the National Bureau of Statistics, rather than to regional offices.
The yuan has seen some recent weakening, while CNY fixing has climbed, suggesting that Chinese authorities are not building foreign currency reserves.
The discrepancies highlight the difficulties in using Chinese data as part of an FX strategy. On one hand, markets react to the official data, even if most participants know that it is often generous in its analysis of underlying Chinese economic conditions. On the other hand, Chinese demand has a direct effect on the economies of its exporting partners.
Numbers from China Beige Book shows that growth in manufacturing weakened in the last quarter, with a slowdown in transport, business investment and real estate growth.
The report compiled by the private New York-based company is modelled on the US Fed’s Beige Book business survey
In a statement, China Beige Book President Leland Miller said that the results show: “the conventional wisdom of a renewed, strong economic expansion in China to be seriously flawed,” adding that surveys "reveal weakening gains in profit, revenues, wages, employment and prices, all showing slipping growth on-quarter – no disaster, but certainly not the powerful expansion suggested by the consensus narrative."
Earlier this month, China’s statistics-bureau chief Ma Jiantang said the agency has “zero tolerance” for falsified data after it publicised cases of manipulated local data and fraudulent export invoices. Jiantang highlighted the changes in Chinese reporting procedures, with raw data from enterprises going directly go to the National Bureau of Statistics, rather than to regional offices.
The yuan has seen some recent weakening, while CNY fixing has climbed, suggesting that Chinese authorities are not building foreign currency reserves.
The discrepancies highlight the difficulties in using Chinese data as part of an FX strategy. On one hand, markets react to the official data, even if most participants know that it is often generous in its analysis of underlying Chinese economic conditions. On the other hand, Chinese demand has a direct effect on the economies of its exporting partners.