Chinese industrial production rose 5.7 percent on the year in July, slowing from growth of 6.8 percent in June and just below the consensus forecast of 5.9 percent. In month-over-month terms, industrial production rose 0.38 percent in July after an increase of 0.50 percent in June.

Within the industrial sector, manufacturing output rose 6.2 percent on the year in July, as it did in June. Utilities output and mining output rose 3.3 percent and 5.0 percent on the year respectively, after previous increases of 2.2 percent and 5.7 percent respectively.

In their statement accompanying monthly data published today, officials characterised the data as showing the economy"maintained a steady development momentum" despite"the complex and volatile external environment and adverse impacts from extreme domestic weather. Officials reiterated their commitment to"more proactive and effective macro policies" but provided no specific guidance about whether additional changes to policy settings will be considered in the near-term.

Growth in industrial production is seen declining to 5.9 percent on year in May versus 6.8 percent in June.

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.