"Peak China": Chinese Data Misses Across The Board As Housing Bubble Returns

Tyler Durden's picture

Following months of warnings that China's economy is slowing down as a result of not only a collapse in China's credit impulse but also tighter monetary conditions, as well as rolling over loan growth which has pressured both CPI and PPI - i.e., the global "reflation trade" - as the following chart from Bloomberg's David Ingels shows...

... and culminating over the weekend with a warning in no uncertain terms from Citi, which said that at least four key economic indicators are "starting to wave red flags" among which:

  • The Markit PMI is starting to turn over
  • China's Inflation Surprise Index - a leading indicator to global inflation metric - has posted a recent sharp drop
  • China's import trade has likewise tumbled after surging recently
  • Chinese Iron Ore imports into Qingado port have plunged

... moments ago China's National Bureau of Statistics validated the mounting fears, when it reported misses across all key economic categories for the month of April, as follows:

  • Retail Sales 10.7% Y/Y, Exp. 10.8%, Last 10.9%
  • Fixed Asset Investment 8.9% Y/Y, Exp. 9.1%, Last 9.2%
  • Industrial Output 6.5% Y/Y, Exp. 7.0%, Last 7.6%
  • Industrial Production YTD 6.7% Y/Y, Exp. 6.9%, Last 6.8%

Additionally, confirming that China is backsliding into its old, "polluting, excess industrial capacity ways, China’s coal output rose to 294.5m tons last month, or up 9.9% Y/Y despite China's so-called production curbs for "dirty industries", even as oil processing declined by 0.6% Y/Y while out output fell 3.7% Y/Y, confirming that more pain may be in store for OPEC as Chinese demand continues to wane, forcing OPEC to cut even more output. In a sliver of silver lining, the NBS also reported that April power output rose +5.4% to 476.7b kwh while natgas output rose +15% to 12.2b cubic meters.

Finally, in yet another indication that Chinese bubble creation and capital misallocation is back front and center, the NBS also reported that new property construction in April surged 482MM square meters, or +11.1%Y/Y for the Jan-April YTD period, while April home sales jumped 7.7% Y/Y.

Bottom line: the economy is once again slowing down as China's unprecedented excess liquidity is once again focusing on blowing bubbles, whether in old, inefficient industries or more disturbingly, housing.

It also means that the PBOC is once again trapped, as any attempts to ease monetary conditions will result in a blow off top in China's housing bubble, its third for the past 4 years, which also risks yet another housing hard-landing, wiping out trillions in "household net worth" for China's citizens.

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BandGap's picture

What a concept, people and businesses not accepting paper bullshit anymore. Who would have thought?

zzzz88's picture

the central banks and government are lying, 

if they print 1 trillion, produce 0.5 trillion GDP, please tell me it is good or not?

so the better way to see it is check the GDP/DEBT ratio,

but they never use this ratio, because the lie will be too obvious to everyone

Yen Cross's picture

  Chew on this bitchez __ Hee Haww!

zzzz88's picture

yes,

the artificial mini cycle poped by central banks started from  last year already peaked,

look at all the major index around the world, you will how far they can go

 

bigsexy's picture

Tte Chinese wrote the book on data manipulation, it is much worse than these charts show. Just ask the FED, they use a similar, watered down version.

DaBears's picture

You haven't seen nigger rich until you lived in China, those clowns are living way beyond their means on debt,  where people earning "$8000" worth of Yuan a year are leveraging up to buy "$1 million" Yuan worth of apartments. Their mao-noploy toilet paper has no where to go but down.

Hongcha's picture

Yes; and they peddle the worst beer in the world.  Worse than mainstream Amerikan beer that rednecks like my li'l brother guzzle in Iowa.

The Real Tony's picture

The Chinese are all born with "house on the brain syndrome".

martinluth123's picture

Why Are Students Using Online Essay Writing Services
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Hongcha's picture

Buy China and buy big.  They are the next 1000-year empire.  Buy the red chips.  Big fish eat little fish.

bigsexy's picture

Please come back on here please let us know how that works out for you.  If you have 1000 year staying power that you are willing to risk on that over inflated BS economy then more power to you. 

Lost in translation's picture

Curious red text right smack in the middle of an e-mail promotion I read from a very large, Mainland Chinese bank. It said the following:

"A friendly reminder:

To borrow, or not to borrow? Do not borrow if you can't pay back!"

Hmmm...

Zepper's picture

Most if not all of the numbers coming out of China are bullshit. Just like over here.

Things must be really bad when the communist country cannot pad their numbers enough to meet concensus? 

r3phl0x's picture

Prolly still trying to reverse engineer the goalseeking spreadsheet they stole from the Fed.

The Real Tony's picture

Even the bus boys are loading up on real estate in China. We see the same in Brampton, Ontario Canada where the residents load up on one bedroom condos by stuffing eight families into each condo paid for by eight welfare cheques.

Mementoil's picture

Silver, bitchez!

Let it Go's picture

The world economy is being propped up by a stack of newly printed money from China. In a world where money flows across borders at the press of a button, it doesn't matter which major central bank is adding money to the system the effect is the same. Today money printed and injected into the economy of any country drives markets higher across the world by distorting demand and prices.

Those who doubt the power of cross-border money flows need only look to Vancouver Canada which has been forced to implement a foreign buyer tax in an effort to halt the rise in housing prices inflated by "hot money" from China. Toronto's housing market has also gone crazy with prices soaring 33% from the prior year. For more on just how much China is expanding its money supply see the article below.

http://brucewilds.blogspot.com/2017/04/china-still-adding-liquidity-to-system.html