The annual statistical black-out for China ended. The data dump was analysed by China Economist Dong Tao. Dong noted a weak start for 2016 on IP, but FAI showed a rare positive surprise with improvements in infrastructure growth and real estate investment. At the same time China Basic Materials analyst, Trina Chen, returned with a view from the ground. Trina noted the first improvement in demand for a long time.
■ Trina found a universal view that infrastructure is picking up, with the central government pushing for project approvals to accelerate. Infrastructure is weighted towards urban subways and pipelines, rather than the old favourites of highways and rail. However, Trina disagreed with the optimism around property investment. Her contacts were uncertain that inventory in lower Tier cities was being worked down and suggested new starts may fall by 10%. The net change for steel demand from higher infrastructure and lower property is yet to be estimated.
The full text of this article is available to MacroBusiness subscribers
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
