China GDP: 6.8% roundly ignored - TDS

Analysts at TDS note that defying consensus expectations for more of the same, Chinese GDP growth edged up from 6.7% to 6.8% (TD 6.8%, mkt 6.7%) while the overwhelming consensus at 33/44 looked for 6.7%.

Key Quotes

“A firmer print would normally put a floor under risk, but all eyes are on Trump’s inauguration later tonight as well as monitoring the drip -feed of headlines from Fed Chair Yellen. The AUD tested $US0.7588 earlier, but directly related to USD positioning not upbeat China data.”

“The government’s GDP target for 2016 was “about 6½ - 7%” and today’s data suite ends the year firmly within target. President Xi Jinping in Davos this week preferred to focus on the bigger picture, hinting that a potentially closed U.S. economy paves the way for a more open China. On growth, he noted that the economy was operating under a "new normal" regime via household consumption, and claimed that the economy was likely to have grown by 6.7% in 2016. We await the next CCP meeting for this year’s growth target. Perhaps 6½%?”

“The rapid CNY depreciation of 2016 has recently reversed and we see a pause around 6.85 -6.70 just now, then we expect further adjustment towards our year -end target of 7.18.”