Chinese industrial production rose 0.06 percent on the month in December after falling 0.31 percent in November, with year-over-year growth slowing from 2.2 percent to 1.3 percent, above the consensus forecast for an increase of 0.4 percent. Previously published PMI survey data also showed ongoing weakness in economic conditions in December, with activity and sentiment impacted by a surge in Covid-19 cases in many parts of the country after authorities eased public health restrictions late in the year.

Year-over-year growth in indusrial production is expected to slow to 0.4 percent in December, down from 2.2 percent in November which was far lower than expected.

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.