CN: Industrial Production

Mon Nov 13 20:00:00 CST 2017

Consensus Actual Previous Revised
Yr/Yr % change 6.3% 6.2% 6.6%
M/M % Change 0.51% 0.56% 0.55%

Chinese industrial production grew 6.2 percent on the year in October, down from 6.6 percent in September and just below the consensus forecast of 6.3 percent. Industrial production rose 0.51 percent on the month in October after an increase of 0.55 percent in September.

Weaker headline industrial production growth in October was driven by the manufacturing sector, where year-on-year growth slowed to 6.7 percent from 8.1 percent in September. Growth weakened in several major industries in the sector, including automobiles, communication equipment, electric machinery, general equipment and textiles. Elsewhere, growth improved, with utilities output advancing by 9.2 percent on the year in October, up from 7.8 percent in September, while mining output fell by 1.3 percent on the year after a drop of 3.8 percent in the previous month.

The decline in year-on-year growth in manufacturing output shown in today's data is consistent with the official CFLP manufacturing PMI survey, which also showed a drop in its headline index in October. The headline index for the Caixin manufacturing PMI survey was unchanged in October.

Industrial production measures the change in the total inflation adjusted value of output produced by manufacturers, mines and utilities. Data are compared with the same month a year earlier.

Chinese data can have a broad impact on the currency markets due to China's dominant influence on the global economy and investor sentiment. It's a leading indicator of economic health. Production is the dominant driver of the economy and reacts quickly to ups and downs in the business cycle. No data are published in February for January.

The industrial growth rate is used to reflect a certain period of increase or decrease in volume of industrial production indicators. The indicator can be used to estimate the short term trend of the industrial economy, to judge the extent of the economic boom and also to be an important reference and basis for the formulation and adjustment of economic policies.