Billion-Dollar Question: Can You Trust China's Economic Data?

Complete with a photo of the young girl who lip-synched “Ode to the Motherland” at the opening ceremonies of the Olympic Games, National Bank Financial economist Clément Gignac wondered in a note if Chinese economic data can be trusted in light of the recent shenanigans in Beijing.

He told clients that the nation of 1.3 billion people releases economic statistics well before G7 countries and rarely revises data like trade.

Mr. Gignac was reacting to reports that the Chinese government may implement a stimulus package to boost domestic consumption, which provided a big boost to the Shanghai market. But retail sales are already at record levels, up 23.3% year-over-year in July, and GDP is said to grow roughly 10%.

As a result, Mr. Gignac is surprised by news of the stimulus plan from Vice Premier Li Keqiang given recent inflationary pressures and restrictive lending measures.

“Whatever the reality, this new push for a stimulus package underscores the fact that the so-called decoupling Asian-U.S. story evoked by the bullish camp members on commodities is under serious stress test,” he said. “Stay tuned.”

Comments

[xhtt:]

The stimulus plan including Rmb 100 or 200 bn spending will be used in one year or two years or even three? Anyone knows about this? I guess no one knows. Do you trust JPM or MS? A Billion-Dollar Question.

2008 Aug 21 04:34 AM

[huangjin:]

I'm surprised he's just wondering now. GDP manipulation has been well known, and everyone knows the central data collectors have to adjust the local and provincial numbers. For instance, during Beijing's Olympic preparations, when billions were poured into the city, Tianjin reported equivalent GDP growth.

2008 Aug 21 08:39 AM