China has a well-earned reputation for fudging a lot of its statistics.
However, because China engages with the larger world economy, there is a limit to how much they can shade the numbers. There is no fudging the magnitude of the Evergrande debt defaults--or the imminent Country Garden debt defaults. Nor is there much upside in presenting entirely false pictures on home sales, employment, manufacturing output, or a variety of other economic metrics. There are practical and pragmatic limits as to how much China can present false data.
(The same, incidentally, is true in the US as well)
What is particularly difficult to obscure without completely making up the numbers are the broader macro trends within an economy. Even with fudged data, we can surmise the existence of deflationary pressures in the Chinese economy that have been expressing themselves for months, and whose origins have been years or even decades in the making.
From a macroeconomic perspective, the trends are what matter, not the individual values. It matters less that China's price data shows it slipping into consumer price deflation in July than that it shows a downward disinflationary/deflationary trend in consumer prices stretching back months. Those trends are the true gauge of economic health, for China and for the rest of the world.
This is great, considering how hard it is to find credible information about china. World just watches China doing its own thing.
China has a well-earned reputation for fudging a lot of its statistics.
However, because China engages with the larger world economy, there is a limit to how much they can shade the numbers. There is no fudging the magnitude of the Evergrande debt defaults--or the imminent Country Garden debt defaults. Nor is there much upside in presenting entirely false pictures on home sales, employment, manufacturing output, or a variety of other economic metrics. There are practical and pragmatic limits as to how much China can present false data.
(The same, incidentally, is true in the US as well)
What is particularly difficult to obscure without completely making up the numbers are the broader macro trends within an economy. Even with fudged data, we can surmise the existence of deflationary pressures in the Chinese economy that have been expressing themselves for months, and whose origins have been years or even decades in the making.
From a macroeconomic perspective, the trends are what matter, not the individual values. It matters less that China's price data shows it slipping into consumer price deflation in July than that it shows a downward disinflationary/deflationary trend in consumer prices stretching back months. Those trends are the true gauge of economic health, for China and for the rest of the world.