A leading index for China’s economy rose at a faster pace in January, suggesting the nation’s growth rebound is maintaining momentum.
The gauge increased 1 percent from December to 253.4, the Conference Board, a New York-based research group, said in a statement today, citing a preliminary reading. That compared with a gain of 0.4 percent the previous month and 1.1 percent in November.
Today’s report adds to signs that economic growth may accelerate for a second quarter after exports rose more than estimated last month and a broad measure of credit increased to a record. The nation’s growth momentum is “relatively strong,” the central bank said in a report released Feb. 6.
The pickup in the index “was driven primarily by consumer expectations and estimated real estate activity, both of which were likely positively affected by the Chinese New Year holiday,” Andrew Polk, an economist with the Conference Board in Beijing, said in today’s statement. At the same time, “ the current rebound in economic activity continues to look modest,” he said.
Foreign direct investment in China fell 7.3 percent in January from a year earlier, the eighth straight decline, Commerce Ministry data showed yesterday, signaling overseas companies have yet to gain confidence in the nation’s recovery.
China’s economy expanded 7.9 percent in the final three months of 2012 from a year earlier, ending seven quarters of deceleration. At the same time, full-year expansion last year was 7.8 percent, the weakest since 1999. The Conference Board said last month that it forecasts 7.5 percent growth in 2013, while the median estimates of analysts surveyed by Bloomberg are for 8.1 percent both this quarter and for the full year.
Components of the leading index, which include loans, a gauge of raw-material supplies, export orders, consumer expectations and floor space started, use data from the central bank and the National Bureau of Statistics, the group said.
China’s economic data are distorted in January and February because of the timing of the weeklong Lunar New Year holiday, which fell in January last year and February in 2013.
First published in May 2010, the index has successfully captured turning points in China’s economic cycles if plotted back to 1986, the group said.