China: First increase in GDP growth in two years - BBH

Research Team at BBH notes that China reported its first increase in GDP growth in two years as it increased to 6.8% year-over-year from 6.7% and is in the middle of the 6.5%-7.0% official range.  

Key Quotes

“Industrial production rose 6.0%, which was slightly lower than expected and down from 6.2% in November.  Retail sales rose 10.9%, a bit faster than expected and the strongest rise in 2016.  Fixed asset investment slowed to 8.1% from 8.3%.  For all of 2016, the Chinese economy reportedly expanded by 6.7%, helped by a 15.4% increase in loan growth.”

“The dollar peaked against the yuan two days after the Federal Reserve hiked interest rates in the middle of last month.  We argue that that is when the market correction began, not at the turn of the calendar.  Despite claims that China's currency is dropping like a rock, it has actually risen for the fifth consecutive week.  That is the longest rising streak for the yuan since early 2016.”