| Actual | Previous | Consensus | |
|---|---|---|---|
| Month over Month | 0.50% | 0.01% | |
| Year over Year | 4.5% | 3.7% | 3.9% |
Highlights
Chinese industrial production rose 4.5 percent on the year in August after growth of 3.7 percent in July, well above the consensus forecast for an increase of 3.9 percent. Output rose 0.50 percent on the month after increasing 0.01 percent previously.
Stronger growth in industrial production in August was largely driven by the manufacturing sector, with output there increasing 5.4 percent on the year after an increase of 3.9 percent in July. This is broadly in line with previously published PMI survey data which also showed some improvement in conditions in the manufacturing sector in August. Growth in mining output also improved, up 2.3 percent on the year after advancing 1.3 percent previously, offset by a sharp decline in year-over-year growth in utilities output from 4.1 percent to 0.2 percent.
Improvement in this report is broadly in line with PMI surveys and inflation data published earlier in the month. Officials characterised today's data including a stronger-than-expected retail sales report as indicating"accelerated recovery" and also noted improved demand and stable prices.
Despite these results, the China RPI and RPI-P are unchanged at plus 7 and minus 10 respectively, indicating that recent Chinese data are, in sum, still coming in no better than the consensus forecasts.
Stronger growth in industrial production in August was largely driven by the manufacturing sector, with output there increasing 5.4 percent on the year after an increase of 3.9 percent in July. This is broadly in line with previously published PMI survey data which also showed some improvement in conditions in the manufacturing sector in August. Growth in mining output also improved, up 2.3 percent on the year after advancing 1.3 percent previously, offset by a sharp decline in year-over-year growth in utilities output from 4.1 percent to 0.2 percent.
Improvement in this report is broadly in line with PMI surveys and inflation data published earlier in the month. Officials characterised today's data including a stronger-than-expected retail sales report as indicating"accelerated recovery" and also noted improved demand and stable prices.
Despite these results, the China RPI and RPI-P are unchanged at plus 7 and minus 10 respectively, indicating that recent Chinese data are, in sum, still coming in no better than the consensus forecasts.
Market Consensus Before Announcement
Year-over-year growth in industrial production is expected to accelerate slightly to 3.9 percent in August versus growth of 3.7 percent in July which was noticeably below expectations for 4.3 percent.
Definition
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.
Description
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.
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.
