China: Soft economic releases – TD Securities

TD Securities analysis team notes that China’s data was softer than expected across the board as industrial production increased by 4.4%% y/y (mkt 5.2%) declining further from a multi-year low of 4.8% y/y in July.

Key Quotes

“China’s manufacturing PMI has been in contraction for 4 straight months, while other indicators such as electricity production remain weak, suggesting limited prospects of any bounce.”

“Similarly after a sharp slowing to 7.6% y/y in July retail sales fell even further to 7.5% y/y in Aug (mkt 7.9%), its lowest since Jan 2007. Finally, fixed assets investment slipped to 5.5% y/y (mkt 5.7%) from 5.7% previously, marking a clean sheet of weaker data. This data will concerning for China’s authorities and could provoke further targeted easing.”