Good economic news from China with suspicious timing

11/11/2013 7:54 pm EST


Jim Jubak

Founder and Editor,

Good news and more good news on China’s economy.

Industrial output up more than expected. Inflation lower than forecast. Total new loans by China’s banks less than expected. Retail sales up.

I just wish all this good news wasn’t so clearly correlated with the meeting of the Communist Party’s Central Committee that began on November 9 and is scheduled to end tomorrow, November 12.

Even the least cynical among us has to admit that it’s very convenient that the data look so good just as the country’s leaders are meeting to decide economic and financial policy

A little more detail on this good news? Sur

Industrial output climbed by a year over year 10.3%. That was above the 10% estimate by economists surveyed by Bloomberg. Industrial output has shown a 10% annual rate of growth for each of the last three months.

Inflation in October rose by a less than forecast 3.2%.

Total new loans for the month came in at 506 billion yuan. That was below the 580-yuan level projected by economists. The People’s Bank has been trying to damp lending in order to head off an asset bubble in real estate and in order to keep inflation under control. Aggregate financing totaled 856.4 billion yuan, well below September’s total of 787 billion yuan. Encouragingly for the central bank’s efforts to rein in the shadow banking sector, trust loans, a category associated with shadow banking fell to just 40 billion yuan, the lowest total since July 2012.

I think the bias in official numbers toward data supportive of government policy is likely to run strong into 2014 as officials gradually announce the policies decided upon by this meeting of the central committee.
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