China Industry February 2016


China: Industrial production starts the year on a weak footing

March 12, 2016

In the January-February period, industrial production expanded 5.4% over the same month of last year. The print came in below December’s 5.9% increase and undershot the 5.6% expansion that market analysts had expected. Authorities usually report the January and February data together in order to smooth out distortions related to the Chinese New Year holidays. The print mainly reflected a softer expansion in manufacturing output. Conversely, growth in electricity, gas and water supply rebounded, while dynamics in mining accelerated in the same period.

On a monthly basis, industrial production expanded 0.38% in seasonally-adjusted terms in February, which was slightly down from the 0.43% increase tallied in January. As a result of the weak growth observed at the beginning of the year, the trend continues to point downward; annual average growth in industrial production ticked down from December’s 6.1% to 5.9% in February, which marks the lowest reading since 1991.

Analysts surveyed this month by FocusEconomics expect manufacturing to decelerate further this year. For 2016, FocusEconomics Consensus Forecast panelists expect industrial production to grow 5.8%, which is unchanged from last month’s projection. In 2017, the panel sees industrial production growth falling to 5.4%.

Author: Ricard Torné, Lead Economist

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China Industry Chart

China Industry February 2016

Note: Year-on-year variation of industrial production index and annual average growth rate in %. Owing to seasonal factors related to the Lunar New Year, annual figures in January and February are reported together.
Source: National Bureau of Statistics of China (NBS) and FocusEconomics calculations.

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