November data shows China recovery continuing

HONG KONG – China’s November activity data has surprised the market on the upside, as the economic recovery gains momentum. As expected, the housing market softened with both investment and sales growth slowing, but the impact was more than offset by resilient infrastructure investment.

HSBC says manufacturing investment grew at the fastest pace in a year, with broad-based recovery seen in heavy industries, machinery and auto, helping to sustain recovery in private business investment.

Retail sales grew faster-than-expected, as durable goods sales benefitted from Singles' Day promotions and car sales also rebounded.

HSBC says the positive growth momentum should continue on the back of fiscal support.

“With the economy having just emerged out of deflation, and with the recovery still looking quite uneven, policy support should remain in place until the recovery becomes more broad-based,” the bank says.   www.hsbc.com (ATI).