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China: Downward trend in investment remains intact in October

November 11, 2015

In the first 10 months of the year, urban fixed-asset investment (FAI), excluding rural households, expanded 10.2% over the same period last year, which was below the 10.3% increase tallied in the January–September period. The print represented the softest increase since 2000 and was in line with what market analysts had expected. The reading reflected weaker dynamics in the tertiary sector. On the other hand, growth stabilized in the secondary sector, while activity in the primary sector improved. In addition, the closely-watched real estate development indicator slowed again in the January–October period, falling to the lowest annual growth rate 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 0.72% in October, which was broadly unchanged from the 0.70% increase tallied in September.

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 11.6% in 2015, which is down 0.5 percentage points from last month’s Consensus. In 2016, the panel sees fixed-asset investment growth slowing to 11.4%, which is down 0.6 percentage points from last month’s forecast.


Author: Ricard Torné, Head of Economic Research

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China Investment October 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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