The Chinese GDP numbers released on Friday appeared to show a strong pick-up in nominal growth in Q4. This was puzzling but possibly attributable to the recent food-driven inflation surge. Some analysts latched onto the pick-up as a bullish signal.

The numbers carried by Datastream changed over the weekend and now show a slowdown rather than acceleration in Q4. The explanation is that there have been upward revisions to the level of nominal GDP in previous quarters, which weren’t available on Friday – we were comparing the new Q4 number with old-basis data for earlier quarters.

The expectation here has been that two-quarter nominal GDP expansion would fall in H1 2020 in lagged reflection of declines in six-month growth rates of money and credit since Q2 2019. The new numbers suggest that that this slowdown has already started – see chart (revised from Friday’s post).