Chinese Devaluation Seems Likely

Over the weekend, we got a slew of data showing a generally weak economy. Below are the actual data compared with the expectations from Bloomberg.

Of course, the headline grabber was the -31.4% drop in residential property sales, but across the board, from industrial production to retail sales to investment came in shy of estimates.

This makes it incredibly unlikely that China is going to hit its growth target this year when all the components are running below estimates. Retail sales are currently running 0.5% behind calendar year estimates, while industrial production is running 0.7% behind and fixed asset investment is 0.3% behind.

Really the only thing working in China right now is exports.

While it is leading to a growing trade surplus.