CN: Industrial Production

Wed Dec 13 20:00:00 CST 2017

Consensus Actual Previous Revised
Yr/Yr % change 6.1% 6.1% 6.2%
M/M % Change 0.48% 0.51% 0.50%

Chinese industrial production grew 6.1 percent on the year in November, down from 6.2 percent in October and matching the consensus forecast. This is the weakest year-on-year growth in industrial output since August. Industrial production rose 0.48 percent on the month in November after an increase of 0.50 percent in October.

Weaker headline industrial production growth in November was driven by the utilities sector, where year-on-year growth slowed to 4.5 percent from 9.2 percent in October. This is the weakest growth in the sector for the year. Growth also weakened in the mining sector, where output fell by 1.7 percent on the year after dropping 1.3 percent previously. These moves were partly offset by slightly stronger conditions in the manufacturing sector, with year-on-year growth picking up from 6.7 percent in October to 6.8 percent in November. Within the manufacturing sector, year-on-year growth strengthened for automobiles, chemicals, and communication equipment but weakened for electric machinery and general equipment.

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

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.