China GDP delay amplifies economic distress signal

It’s mid-afternoon Monday in Beijing and a simple question is doing the rounds: will China’s latest GDP figures be published as scheduled the next day? The Chinese customs had unexpectedly not released its trade data on Friday. By 4PM it’s clear that the statistics bureau has followed suit, the only indication being a tweak to the online publication timetable set a year earlier. A day later, there’s still no sign of when the data will land, nor any clear explanation. The delay to this usually well-choreographed and executed quarterly exercise is an aberration. It’s also unnecessary.

It invites speculation that the numbers show the economy is in bad shape and are being kept under wraps so they don’t steal the thunder of the ruling Communist Party’s twice-a-decade congress, which began on Sunday. A massive amount of manpower and resources has been dedicated to beef up security and keep Covid-19 infections next to zero for the occasion. China’s state banks also stepped up their intervention to defend a weakening yuan on Monday, per Reuters.

But officials have played down the importance of GDP targets this year. Moreover, given economists reckon this could be China’s second-slowest year of growth since 1976, per a Reuters poll, investors have probably priced that in. That’s including expectations that output would have rebounded from the weak 0.4% growth in the second quarter to 3.4% in the three months to the end of September. Last month was also a pleasant surprise on the stimulus front: new bank lending nearly doubled from August as the central bank guided more credit support.

President Xi Jinping’s opening speech at the congress already invoked a sobering sense that politics is above all else. China has long been accused of dressing up official figures, and such added uncertainty over planning sabotages the government’s own effort to improve data quality and crack down on fake reporting. Ultimately, it’s the lack of communication, or the willingness to do so, that does more harm to confidence than ugly numbers.

China’s National Bureau of Statistics late on Oct. 17 delayed the release of the country’s third-quarter gross domestic product data, originally scheduled for Oct. 18, as well as other economic indicators due later in the week. The agency has not yet rescheduled their release.

The delay came amid the twice-a-decade congress of the ruling Communist Party which runs from Oct. 16 to 22.
Source: Reuters (Editing by Antony Currie and Thomas Shum)