China abruptly postponed the release of key economic data, a day before its scheduled release, as the ruling Communist Party gathers for a major political meeting against the backdrop of a faltering economy.
The country’s National Bureau of Statistics updated its schedule on Monday, marking the dates of a series of economic indicators – including closely watched GDP growth – as “late”. The indicators, which were due to be released on Tuesday, also include quarterly retail sales, industrial production and monthly unemployment rates.
The office did not give a reason for the delay and did not specify a new date for publication.
Separately, the country’s customs authority also postponed the release of monthly trade data, which was initially scheduled to be released on Friday.
The forecast data delay coincides with the week-long 20th National Congress of the Communist Party in Beijing, where Chinese leader Xi Jinping is expected to secure a third term in power. The priorities presented at the meeting will also determine China’s trajectory for at least the next five years.
Iris Pang, chief economist for Greater China at ING Group, said in a research note on Tuesday.
Other analysts think that may be because data sets are not pretty.
“I expect a further decline of 1.2% [on a quarterly basis for China’s GDP]. “This means that China has joined the United States in a technical recession,” said Clifford Bennett, chief economist at ACY Securities.
He said the delay would make sense “from an image management perspective”. Some economists describe two consecutive quarters of contraction as technical stagnation.
China’s GDP fell 2.6% in the second quarter from the previous quarter, reversing 1.4% growth in the January-March period. On an annual basis, the economy expanded 0.4% in the second quarter.
Analysts widely expected third-quarter growth to remain subdued, as severe Covid restrictions, the mounting crisis in real estate and slowing global demand continue to weigh on the economy.
Economists polled by Reuters expected China’s gross domestic product to expand 3.4% in the third quarter from a year earlier. This would be well below the government’s full-year growth target of around 5.5%.
Several international organizations, including the International Monetary Fund and the World Bank, recently lowered their GDP growth forecasts for China for this year.
Bennett expected third-quarter GDP data to be released after the party convention.
“When the release happens, we should all be prepared for some global financial market reaction if the world’s two largest economies are in recession this year,” he said.
The Chinese economy is facing increasing challenges. Growth has stalled, youth unemployment is at a record level, and the housing market is in disarray. The ongoing COVID-19 lockdowns have not only caused havoc in the economy, but also increased social discontent.
In the report of the 20th Party Congress released on Sunday, Xi reiterated his pledge to develop China into a “medium-developed country” by 2035.
That means China needs to grow at an average growth rate of about 4.7% per year from 2021 to 2035, according to Larry Ho, chief China economist at Macquarie Group.
Hu added that the goal may be difficult to achieve, as the economy faces several structural headwinds, such as a real estate downturn, an aging population, and rising US-China tensions.
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