China's economy is heading into a closely watched stretch. A batch of official data due Monday is expected to show industrial output and consumer spending both grew more slowly in October, according to economists surveyed by Bloomberg News, even as a slump in investment appears to have eased only marginally. The numbers will be the first broad scorecard since Chinese policymakers moved to open up stimulus spending, and they arrive just ahead of a key meeting next month where leaders will set economic policy direction.
The timing matters because China is also preparing to host world leaders. The Asia-Pacific Economic Cooperation forum will hold its Economic Leaders' Meeting November 18 and 19 in Shenzhen, the southern technology hub that China selected in part to showcase its advances in innovation and artificial intelligence. Chinese President Xi Jinping is set to attend the summit and related events, and the government has said it welcomes foreign firms to deepen investment cooperation in China. The China International Import Expo, held earlier this month in Shanghai, reportedly drew more than 85 billion dollars in intended deals, a sign that officials are emphasizing openness to outside investment even as domestic demand shows signs of softening.
Investor sentiment has been mixed. Morgan Stanley's latest indicator shows sentiment toward mainland Chinese stocks has slipped back into bearish territory, with the bank favoring onshore shares over Hong Kong-listed equities, and favoring domestic technology self-sufficiency over global AI supply chain exposure. At the same time, China's export sector has continued to perform relatively well, giving policymakers some room to maneuver as they calibrate additional support for the broader economy.
The Shenzhen summit will also be notable diplomatically, with regional leaders expected to use the sidelines for bilateral meetings on trade and security matters across the Asia-Pacific region.
Monday's data release will set the tone heading into China's year-end economic policy meeting, while the APEC summit in Shenzhen later this month will be watched for any new announcements on trade and investment cooperation.
Why is Shenzhen hosting APEC this year?
China selected Shenzhen, a major technology hub, in part to highlight its progress in innovation and artificial intelligence to visiting world leaders.
What is expected in Monday's economic data?
Economists expect October figures to show slower growth in industrial output and consumer spending compared with recent months, with investment declines easing only slightly.