As China’s economy slows down, its macroeconomic data is increasingly hard to make sense. As the FT explains, “The country’s gross domestic product had grown 0.8 per cent in quarterly terms and 6.3 per cent year on year in the second quarter. The combined quarter-on-quarter growth over the previous four quarters, however, implied growth of 6.8 per cent.
The mismatch arose because of official “seasonal adjustment” revisions by the country’s National Bureau of Statistics to the quarterly growth data in 2022. While such revisions are routinely made, economists say their effect has become larger in recent years.
The lack of any detailed explanation on the process illustrates the difficulty in parsing China’s statistics at a time when the trajectory of its economy is seen as crucial for global growth.
“That is where we are at the moment. How much has the economy grown in the second quarter, or [has it] not? That is a very important question for the markets and policymakers alike,” said Louis Kuijs, chief Asia economist at S&P Global. “Everyone is asking, ‘Is the Chinese economy stalling?’ It’s not easy to give a waterproof answer to that.””
Beyond the fact that China’s GDP growth data is no longer making sense, other streams of data are disappearing thus making it difficult to look under the bonnet and figure out what exactly is happening in the world’s second largest economy: “Carlos Casanova, senior economist for Asia at UBP, said he had been unable to access detailed data on local government land sales on Wind, a data platform, since its use outside the country was restricted this year. “If I were to guess, I would say the reason for that is that pockets of stress have appeared . . . and they don’t want the market to get too carried away,” he said….
Questions around the reliability of domestic data flared up under the country’s zero-Covid policy. In the absence of clear information from local authorities, traffic data was used as an indicator of the severity of citywide lockdowns. The government stopped publishing death data after a nationwide outbreak began. This month the province of Zhejiang released and then deleted figures showing a sharp rise in cremations.”
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