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The first string of Chinese data is out but before we jump intowhat the numbers mean, here's a quick recap: Ting Lu, China economist for Bank of America-Merrill Lynch gives usan insight into the potential implications of the May data pointsso far: Industrial production - If there isn't a "significant rebound in June" then IP growthcould be around 9.6 percent YoY in the second quarter, below 11.6percent the previous quarter. IP represents 40 percent of economyand poor growth in IP data could see China's Q2 GDP growth atanywhere between 7 - 7.5 percent and could very well bring streetcuts of 2Q GDP growth forecasts. CPI and PPI - Consumer prices fell more than expected in May, and PPI alsofell further giving policymakers room for more stimulus measuresand utility price hikes. CPI should fall further in coming monthsafter "slumping oil prices" (and lets not forget China announced a fuel-price cut yesterday , the steepest cut since 2008). Fixed Asset Investment (FAI) - A quick breakdown of the data, property FAI growth rebounded to18.0 percent in May, from 9.2 percent in April. Railway investmentgrowth was -35.2 percent, compared with -46.9 percent the previousmonth. Manufacturing FAI jumped to 28.2 percent in May, from 22.7percent the previous month. The leading indicators of FAI growth,total planned investment in newly started projects jumped to 28.2percent, from 191.9 percent in April. "The pickup of FAI growth inMay suggests that the govt was ramping up infrastructure and socialhousing investment to bolster the economy on the weak economic datain April." Retail sales - While headline retail sales number eased in May compared toApril, inflation adjusted numbers show that real retail salesinched higher to 11.0 percent in May, from 10.7 percent in April.Sales of home appliances were weak and auto retail sales by volumeis yet to be released but could rise in May based on preliminarydata. The Big Picture Market reactions to be mixed since industrial production growthconfirmed the trend of slowdown since April, but after the interestrate cut on Thursday, market were possibly pricing in much worse.With FAI coming in line with expectations, retail sales holding up,and larger than expected drop in inflation the government has moreroom to easy policy. Ting says: "We expect the govt to start and speed up more projects on the onehand and to make project financing easier via cutting RRR/rates,approving more enterprises bonds and lifting more lendingrestrictions. However, without Greek exit from eurozone, we expectthe size of overall stimulus could be relatively small (slightlybelow 1% of GDP)." Don't Miss: Here Are 15 Reasons Why Everyone's Suddenly Freaking Out AboutChina. The e-commerce company in China offers quality products such as China Pillow Block Bearings , Single Row Tapered Roller Bearings, and more. For more , please visit Single Row Tapered Roller Bearings today!
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