"Targeted policy measures may provide some support in Q4, but the LEI does not point to a sustained pick up in the economy any time soon."
- Conference Board
Economic activity in China continued to increase in August of current year; however, the pace of advance slowed from two previous months. The aggregate index, calculated by the Conference Board, rose 0.7% to 299.8 points last month, down from a growth of 1.2% in July and 1.3% in June, meaning that the world's second biggest economy is experiencing issues with economic development. The index for China is based on six economic indicators, including housing, consumer expectations, exports orders, raw materials' supplies, new loans and orders. Among them, real estate activity and consumer expectations declined slightly, while only three indicators registered a climb and positively contributed to the index. One more important indicator, which evaluates current economic conditions in China, is called Coincident Economic Index. It remained unchanged at 264.6 points in August after a 1% jump in both July and June, as surging retail sales were upset by falling industrial production. Therefore, analysts notice that there are mixed signals for China's economy and development of next months may explain the situation better. Meanwhile, the government of China is preparing to take further actions to support GDP growth on present levels of around 7.5%, thus helping to improve leading indicators in the foreseeable future. However, Fitch Ratings agency says that Chinese economy is currently undergoing a period of rebalancing and country's officials may refuse to add more stimulus to it.
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