Monthly activity data from China for August was released overnight and it turned out to be solid. Industrial production, retail sales and urban investments all came in above market expectations. A large beat was reported especially in retail sales data with sales increasing 5.4% YoY, compared to 3.9% YoY expectations. However, some worrying remarks came from China's National Bureau of Statistic (NBS). Namely, NBS said that demand is recovering more slowly than supply and that the Chinese economy is facing more challenges in 2022 than in pandemic-hit 2020. This should not, however, come as a surprise as 2022 sees more Covid-related lockdowns in China than 2020. Nevertheless, NBS expects the Chinese economy to remain in recovery mode throughout the year 2022.
Chinese index CHNComp caught a bid following the release. The index launched today's trading below 6,425 pts support but jumped following release of monthly data from China and managed to fill the bearish price gap. However, the advance did not last long and the index pulled back again. Another attempt of breaking below the aforementioned 6,425 pts zone, which acted as a floor for the index in recent days, can be spotted at press time. Note that the index is currently trading at the lowest levels since mid-March 2022.
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CHNComp at H1 interval. Source: xStation5
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