Chinese October data thumping along

China’s October data dump has landed and is thumping along still. Industrial production was in at 6.1%, fixed asset investment at 8.3% and retail sales 10%, all looking distinctly L-shaped :

Contrary to my outlook, construction starts rebounded to 8.1 year to date:

And floor area under construction is still tracking at 3.3% year to date and looks likely to beat my estimate of flat on the year:

Steel output is booming at 68.5mt, highest ever for any October and offering at least some basis for the mad bubble in bulks:

Cement is warm but not as hot:

Floor area sales are still running red hot as well up 26.8% so the tail is still there for the boom.

However, October credit did slow sharply with total social financing in at 896bn yuan even if the three month moving average is still firm:

Year on year lending is still up 88%:

Shadow banking is still firm and the downtrend gone:

M2 is stable at 11.6%:

And the rolling annual is still growing at a good clip:

New household loans, mostly mortgages, fell -32% to 433.1 bn month on month so there is evidence that macroprudential is biting on the property bubble.

In sum, it still appears likely that mortgage tightening will filter through to lower sales and starts in the months ahead. But, my outlook has probably been one quarter ahead of reality so the upwards pressure on bulk commodities could remain for Q1 next year.

Iron ore is limit up again today as the craze continues. When it will pop is anyone’s guess but not on this data!