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China: Downward trend in investment remains intact in August

September 13, 2015

In the first eight months of the year, urban fixed-asset investment (FAI), excluding rural households, expanded 10.9% over the same period last year, which was below the 11.2% increase tallied in the January-July period. The print represented the softest increase since 2000 and undershot the 11.2% expansion that market analysts had expected. The reading mainly reflected weaker dynamics in the secondary and the tertiary sectors, while activity in the primary sector picked up slightly to a five-month high. In addition, the closely-watched real estate development indicator slowed again in the January-August period, dropping to the lowest annual growth since the trough of the financial crisis in 2009.

A month-on-month comparison shows that investment in urban fixed assets rose a seasonally-adjusted 0.73% in August, which was broadly unchanged from the 0.75% increase tallied in July.

The government set a growth target of 15.0% for urban fixed-asset investment for this year. FocusEconomics Consensus Forecast participants expect fixed-asset investment to grow 13.8% in 2015, which is down 0.1 percentage points from last month’s Consensus. In 2016, the panel sees fixed-asset investment growth slowing to 13.1%.


Author: Ricard Torné, Lead Economist

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China Investment August 2015

Note: Month-on-month changes of seasonally adjusted urban fixed-asset investment index and annual growth rate (year-to-date) 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).


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