China: slowing, but still shopping
The idea that China is slowing is hardly new and it hasn't put off Chinese consumers.
China has long been accused of manipulating its GDP figures, and the latest data did nothing to allay scepticism. The economy grew by 6.9% year-on-year in the third quarter, only a little down on the previous quarter, despite poor data over the summer. It left the government on track to hit its 7% full-year target. An alternative index devised by Chinese Prime Minister Li Keqiang, covering electricity consumption, bank lending and rail cargo all deemed harder to fake than GDP points to growth of 3%-4%.
But the idea that China is slowing is hardly new. What matters is the broad direction of travel, which is more encouraging. Industrial production growth eased to 6% year-on-year, but retail sales grew by 10.9%. "Despite widespread panic about the health of the Chinese consumer, she is clearly out spending," says Lex in the Financial Times. "Take a look at any international shopping district."
Stronger services are offsetting a weaker industrial sector, adds The Economist good news, because services now comprise a bigger proportion of GDP than industry. As a result, the jitters over a hard landing look overdone, especially as recent cuts in interest rates have bolstered credit growth, and there is plenty of scope for more fiscal and monetary stimulus.