Chinese fixed asset investment rose 3.9 percent year-to-date in June, easing from growth of 4.0 percent in May. In month-over-month terms, fixed asset investment rose 0.21 percent in June after dropping 0.04 percent in May.

Officials characterised GDP and monthly data published today as showing that"the national economy was generally stable with steady progress". However, they also cautioned that"the external environment is intertwined and complex, the domestic effective demand remains insufficient and the foundation for sound economic recovery and growth still needs to be strengthened". After noting in recent months that they will seek to"frontload and effectively implement" macroeconomic policies that have already been introduced, today's statement did not contain this language, perhaps indicating that some adjustment to policy settings may be considered in the near-term.

Data published today were generally weaker than expected. The China's RPI and RPI-P, however, rose from minus 29 and minus 30 to minus 7 and zero respectively, indicating that recent Chinese data in sum are now coming in close to consensus forecasts.

Fixed asset investment for the year-to-date to June is expected to rise 3.9 percent. This would compare with 4.0 percent growth in May.

Investment in fixed assets refers to the investment in construction and purchase of fixed assets by private and state-controlled domestic enterprises and households (excluding rural households) involving a total planned investment of CNY5 million yuan or more. Separate data for private investment and state-controlled investment are published as well as more detailed data on an industry basis.

Investment in fixed assets is an important part of gross domestic product and also provides the additional productive capacity to an economy that is required to drive future growth. Strong growth in this category of spending indicates that enterprises are confident about future prospects and is generally associated with rising employment and incomes.

Investment in fixed assets therefore provides information about near-term and future economic growth. Investors need to closely track the economic growth because it usually dictates how investments will perform. Investors in the stock market like to see healthy economic growth because robust business activity translates to higher corporate profits. Bond investors are more highly sensitive to inflation and robust economic activity could potentially pave the road to inflation. By tracking economic data such as GDP, investors will know what the economic backdrop is for these markets and their portfolios.