Chinese GDP data published today show growth slowed sharply at the end of 2022. China's economy was unchanged on the quarter in the three months to December, weakening from growth of 3.9 percent in the three months to September but stronger than the consensus forecast for a decline of 0.9 percent. Officials noted that"the foundation of domestic economic recovery is not solid" and cited both external and domestic factors as weighing on recent economic performance.

Monthly PMI survey data also indicated that economic conditions weakened sharply in the last few months of 2022. Activity and sentiment were impacted early in the quarter by tight public health restrictions but were also impacted later in the quarter by a surge in Covid-19 cases in many parts of the country after authorities eased those restrictions.

In year-over-year terms, growth slowed from 3.9 percent in the three months to September to 2.9 percent in the three months to December, above the consensus forecast of 1.9 percent. Annual GDP growth slowed from 8.1 percent in 2021 to 3.0 percent in 2022. This is well below the 5.5 percent growth target officials announced early in 2022, with this short-fall largely reflecting prolonged lockdowns in major cities and other policies driven by Beijing's efforts to keep Covid contained.

Fourth-quarter GDP is expected to contract 0.9 percent versus the third quarter which would compare with 3.9 percent sequential growth from the third quarter. The year-over-year expectation in the fourth quarter is growth of 1.8 percent which would also compare with 3.9 percent growth last time.

Gross Domestic Product (GDP) refers to the final products at market prices produced by all resident units in a country (or a region) during a certain period of time. GDP is the core indicator of the national accounts, and also an important indicator to measure the economic conditions and the level of development of a country or region. GDP is calculated from three approaches -- production, income and expenditure -- which reflect gross domestic product and its composition from different angles.

GDP is the all-inclusive measure of economic activity. The GDP report contains a treasure-trove of information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. GDP components such as consumer spending, business and residential investment, and price (inflation) indexes illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.

The data are compiled by NBS and the People's Bank of China (PBoC). Estimates for non-financial corporations, financial corporations, general government, household and the rest of the world sectors are published. The production accounts, distribution and use of income account, and capital account data are compiled by NBS. NBS also develops the financial account by rearranging financial transactions data in the flow of funds accounts compiled by PBoC. There are no breakdowns of government consumption expenditure, gross fixed capital formation, change in inventories and net exports. Household consumption expenditures are broken down into urban and rural. The income components of GDP are only published in the input-output tables. NBS uses the Chinese Industrial Classification of the National Economy.