The big story in economic news overnight is that China came out with a fresh round of data that handily beat expectations.
This is part of a longer pattern over the past couple months where Chinese data hasn’t been that bad.
This is funny for two reasons:
- There is a gigantic slump happening in the other BRICs countries, and other emerging markets as a whole.
- Several months ago, at the start of the year, the Chinese hard landing was the story on investors radars.
Not only is the hard landing not materialising, China is the best of the bunch. Ironic.
Meanwhile, here’s BofAML on the strong data from China and what it means for growth targets:
With today’s higher-than-expected IP growth reading, we see clear upside risk to our 7.6% yoy growth forecast for 3Q13 and 7.6% annual GDP growth forecast for 2013. As we expected, Street economists have already revised up their growth forecasts in the past month, but we now expect another round of upward growth revisions on the Street in the next couple of weeks. On quarterly growth patterns, we expect an impressive recovery in 3Q13 (our official forecast at 7.6%, but we see upside risk) from 7.5% yoy in 2Q13, a bit moderation in 4Q13 due to slowdown in restocking and base effect, a rebound again in 1H13 on a low base, and slowdown again 2H on falling trend growth and base effect.