Investors should expect weaker April sequential industrial production growth, better trade numbers, lower inflation and steady monetary conditions in China, according to a report by Goldman Sachs Gao Hua.
China is scheduled to release April trade data on May 8, consumer price index (CPI) and producers price index (PPI) on May 9, industrial production and retail sales numbers on May 13, and money and credit data before May 16.
China’s April purchasing managers index (PMI) and domestic commodity prices suggest April industrial production could be on the weak side.
Goldman Sachs Gao Hua expects April industrial production growth to be 8.8% year-on-year, the same as the growth rate in March.
This implies sequential growth of 5.2% month-on-month, down from 8.4% in March.
The firm also expects April retail sales growth to improve slightly to 12.3% year-on-year from 12.2% in March.
China’s exports and imports growth will likely show some improvement. The government’s crackdown on over reporting by exporters to facilitate inflows happened in the second half of April 2013, which lowered the base for year-on-year growth rates.
The bank expects April exports growth to be 1% year-on-year. higher than the 6.6% drop in March. April imports are expected to grow at 1%, higher than the 11.3% drop in March.
The implied trade balance would be a surplus of US$18.5 billion, up from the US$7.7 billion in March.
April CPI will likely to show 2.0% increase year-on-year, lower than the 2.4% recorded in March. PPI is likely to drop 1.9% year-on-year, higher than its March decline of 2.3%.
The bank expects the amount of RMB new loans in April to be RMB792 billion, the same as in last April. This implies a growth of 13.7% in April, down from the 13.9% in March.
April M2 growth to be 12.3% year-on-year in April, up slightly from March growth of 12.1%.
