Interpreting Chinese Growth

China reported that its GDP in 2015 was 6.9% higher than in 2014. For anyone fixated on a 7% growth target, this was slightly disappointing but a statistically insignificant discrepancy. The chart illustrates quarterly changes for China’s GDP, as they would be reported in Australia, since 2011. The December quarter growth rate was 1.6% or, using the typical US reporting format, 6.6% annualised. Growth has slowed over the past two quarters but has not been greatly out of line with the majority of quarterly results since 2012. The departure from 7% over the past year has arisen primarily from an unusually poor March 2015 quarter. The March result is no less real for being an outlier but the data, viewed in this fashion, suggests a Chinese economy still operating well ahead of its worst for most of the past year. Of course, any data-based conclusion presupposes that the numbers have not been doctored by an autocratic government looking to secure its political fortunes or by officials seeking to curry favour with the political leadership.