China: Industrial production recovers strongly in November
Industrial production increased 6.2% year-on-year in November, well above October’s 4.7% expansion. The print overshot analysts’ expectations of a 5.0% rise and represented the strongest reading in five months. The expansion was led by sizeable accelerations in all main sub-components, especially manufacturing and mining.
On a month-on-month seasonally-adjusted terms basis, industrial production increased 0.78% in November, up from the 0.20% expansion in October. Annual average growth in industrial production, meanwhile, stabilized at October’s 5.6% in November.
According to Tao Wang, chief China economist at UBS, November’s strong reading reflects:
“Less tight production control, modest recovery of domestic demand, plus a lower base. As the enforcement of environmental protection eased on the margin and construction activities stayed robust, VAI growth of chemicals, textile, ferrous metal and non-metal mineral sectors all strengthened notably, as production of cement, ethylene and steel rebounded. Auto sector value added growth picked up on a low base, as auto production gained momentum. In addition, VAI of machinery and electronics sector both edged up, although cell phone production edged down somewhat.”