From Pantheon Macroeconomics:
- China: Industrial production growth dipped to 2.2% y/y in November from 5.0% in October. Consensus was 3.5%.
- Retail sales dropped 5.9% y/y in November, worsening from -0.5% in October. Consensus was -4.0%.
- Fixed assets investment ex rural growth slowed to 5.3% y/y in November from 5.8% in October. Consensus was 5.6%.
- New home prices fell 0.25% mom in November, improving from -0.35% in October. Bloomberg reports no consensus.
- 1-year MLF rate was unchanged at 2.75%. Consensus was 2.75%.
- Japan: Export growth decreased to 20.0% y/y in November from 25.3% in October. Consensus was 19.7%.
China’s economy darkens in November
China’s economic data were weaker than market expectations in November, as Covid cases soared, leading some regions to enforce tough measures. The central government guidance was for local officials to avoid overzealous application of lockdowns and isolation requirements, but this message was only starting to get through. Case numbers have continued to increase since then, as local governments moved away from broad zero-Covid policy without a strategy to flatten the curve. The coming exit waves over the next few months put pressure on hospitals and force local government in some regions to reimposition of broad restrictions temporarily, further hitting the economy.
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