Chinese industrial production rose 4.4 percent on the year in June, picking up from an increase of 3.5 percent in May and well above the consensus forecast of 2.6 percent. Manufacturing output rose 4.2 percent on the year in June after an increase of 4.1 percent in May, while utilities output growth slowed from 4.8 percent to 4.1 percent. Mining output rose 1.7 percent on the year after a previous decline of 1.2 percent. In month-over-month terms, industrial production increased 0.68 percent in June after increasing 0.63 percent in May.

Today's data were generally above expectations, resulting in an increase in the China ECDI from minus 57 to minus 16 and the ECDI-P from minus 60 to minus 3, indicating that data are underperforming market expectations to a lesser extent.

Year-over-year growth in industrial production is expected to slow to 2.6 percent in June versus growth of 3.5 percent in May which was very close to expectations but noticeably slower than April's growth of 5.6 percent.

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.