MNI: 5 Things To Look For: China Q4 GDP Data

--China Q4 GDP Data Due For Release Jan 18

     BEIJING (MNI) - China's GDP data will be released on Thursday, Jan 18,

including industrial output, fixed-asset investment, retail sales and real

estate sales & investments. MNI survey indicate analysts generally expect a mild

slowdown in the fourth quarter, with the median estimate at +6.7% vs +6.8% in

Q3.

     Ahead of the release, MNI outlines five themes that warrant particular

attention:

- Upside risks: 2017 annual GDP growth is likely to be "around 6.9%", as Premier

Li revealed earlier in a conference last week. Any GDP growth rate different

than 6.9% will be a surprise to the market. An annual growth rate of 6.9%

implies China's economic condition is stable at the moment. With annual GDP

growth rate less of a secret, the factors supporting GDP growth will be the main

focus.

- Upside risks in industrial output growth: Environment protection campaign is

likely to reduce industrial output, and the market expects to see a weaker

industrial output growth of 6% in December. However, MNI notes that industrial

output has tended to pick up at the quarter-end -- March, June and September

this year. A higher-than-expected industrial output is likely to push up Chinese

bond yields.

- Growth in infrastructure investment may remain strong. While growth in

fixed-asset investment (FAI) was relatively weak in October and November,

infrastructure investment was nonetheless strong. If December data on

infrastructure turns out strong, its contribution to growth will be more

pronounced. That means the funding constraint of local governments will likely

be relaxed next year if a slowdown does happen.

- Growth in real estate investment may stabilize after a slower trend since

April. Investors' concerns of property restrictions have been alleviated

speculating the government will loosen regulations somewhat to deal with

economic downward pressures. Rising property investment growth in December may

further boost investors' confidence in real estate in 2018.

- Retail sales face downside risk: December import growth was surprisingly low,

raising concern that domestic demand has weakened. A possible retail sales

slowdown will add to the concern.

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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