Goldman's Expect M/M Momentum To Ease for April Activity, But Base Effects To Boost Y/Y Prints

Goldman's on China activity data for tomorrow - weaker m/m outcomes expected, but y/y pace boosted by base effects.

• "We expect activity growth to slow on a month-over-month basis in April. High frequency indicators such as steel demand showed weaker month-over-month growth in April, and both NBS and Caixin manufacturing PMIs decreased. On a year-over-year basis, however, we expect industrial production, retail sales and fixed asset investment growth to accelerate due to the very low base in April 2022. Specifically, IP is likely to grow 12% yoy in April, faster than 3.9% yoy in March. This implies a sequential change of -1.3% mom sa non-annualized in April (vs. -0.2% mom sa non-annualized in March). We forecast retail sales growth to be 26% yoy, much faster than the 10.6% yoy in March, mainly on favorable base effect. Our forecast implies +0.3% month-over-month non-annualized growth in April, vs +2.9% in March. We expect FAI growth to be 7% yoy in April (-0.2% month-over-month non-annualized), vs 4.8% yoy in March (+0.9% month-over-month non-annualized, which implies year-to-date year-over-year FAI growth to increase to 5.7% yoy, from 5.1% yoy in March)."