From Dad’s Army comes Joe Hockey
“I’m not as bearish as many others about China. Why? Because China must grow…Beijing needs to make sure that their country grows to create the jobs that ensures it does not have social dislocation into the future”.
China will create enough jobs, yes, just not in construction any more and that will not be good for Australia at all. There’s more of China’s dreadful data dump from Forexlive:
Louis Kuijs, RBS:
- We think the risks of a more pronounced downturn in real estate and a material decline in infrastructure investment have receded, in part because of recent actions and plans of policymakers
- However, in our view, the risks of more spill-over of the weakness in industry onto the broader economy have increased
- A potential sharp correction on China’s stock markets could have economic impact and consequences for financial instability
Minggao Shen, Serena Wang, Citigroup:
- The planned investment for newly-started projects only grew 0.2% year on year in Jan-Apr, down by 5.9 percentage points from the first quarter, suggesting a weak investment growth outlook in coming months … remains the key drag on growth in the near-term
Liu Li-Gang, Zhou Hao, ANZ
- Housing sales in top-tier cities increased significantly in April, which could accelerate property investment growth in the coming quarters
Zhao Yang, Nomura:
- The property sector is still digesting the high inventory and focusing on ongoing projects. The investment slowdown will likely continue for some time to come.
- Infrastructure investment growth was actually not bad
- Government’s easing measures since the fourth quarter of last year are showing some positive effects
Julian Evans-Pritchard, Capital Economics
- We think a sharp slowdown over coming quarters can be avoided
- Despite further confirmation of a weak start to the second quarter in today’s data, we remain optimistic that the government’s annual growth target of “about 7.0%” can be achieved
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From the top:
- infrastructure growth is tumbling
- first tier property sales will not boost construction in aggregate if 95% of construction is in lower tiers
- easing to date is showing very little return
- we’re already in a sharp slowdown. 7% may be possible with some fiddles but looks very difficult on the ground as credit has not responded
