Digging into the numbers reveals the same trend in the other data sets. November data is the second weakest for the year after September. The October spike is a bounce, not a trend yet. Private fixed asset investment slowed to 14.9% in November; it was 11.7% in September. Below trend growth is the story of 2014 and 2015 will likely open with a big drop in growth that will “surprise” anyone watching the year-to-date cumulative figures.
Industrial production continues to slow. Looking at the breakdown of data from the report, the real estate slowdown is still having a big impact. Cement production fell 4% in November; plate glass contracted 6.3%. More concerning for the broader economy is the 4.5% drop in auto production, as well as the 0.6% growth in electricity production, which is now only up 3.9% ytd in 2014.
The drop in oil prices has further to go if the Chinese economy continues to slow.