Leading indicators in China are already showing signs of an uptick in the economy, a senior statistics official said on Thursday, in stark contrast to downgrades of growth estimates by investment banks after disappointing data last week.
Fixed asset investment rose by 20.2 percent on year in the first four months of this year, below market expectations and down from 25.4 percent for the same period in 2011, as a credit squeeze on China's real estate developers and a worsening international environment continued to bite.
"Forward looking indicators are starting to recover. At least we can say in the future, the Chinese economy will not have a sharp slowdown," Pan Jiancheng, deputy director-general at the China Economic Monitoring & Analysis Center, a unit of the National Bureau of Statistics, told a conference organised by market research firm Nielsen.
Pan pointed to an uptick on a monthly basis in leading indicators such as the new orders and input purchasing sub-indexes in the NBS' Purchasing Manager Index, as against a slide in manufacturing output, which measures past economic performance.
Industrial production rose 9.3 percent on year in April, well below market expectations.
It was one of a clutch of numbers that led economists to cut their consensus call for China's second quarter growth to 7.9 percent from 8.3 percent previously. Full-year growth estimates were trimmed to 8.2 percent from 8.4 percent.
"There's been an acceleration in the GDP slowdown and therefore everyone is worried," Pan conceded.
China's annual growth slipped to 8.1 percent in the first three months of 2012, its slowest pace in almost three years. That level had been widely expected to mark the bottom of a downswing which now seems set to extend into a sixth straight quarter.
Nonetheless, Pan noted that a business confidence index rose in the first quarter compared with the fourth quarter.