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Xinhua: The Troika Out of Steam and Economic Recovery Difficult

According to the macro-economic statistics recently released for the month of May, investments, exports, and consumption all fell below market expectations. The total social financing was 1.19 trillion yuan, a drop of over 30 percent from the figure for April. Since September of 2012, the Producer Price Index (PPI) and the industrial value added have hit new lows.

A review of the “Troika” (fixed asset investments, retail sales, and exports) that is deemed to be the driving force for economic growth shows fixed-asset investments grew slower than April by 0.2 percent compared to the growth from last year which was 20.4 percent; retail sales, with a growth of 12.9 percent from a year ago, was also below market expectations; exports in May grew one percent from a year earlier, a reduction of 13.7 percentage points compared to April’s growth. This was way below the 5.6 percent market expectation; it has hit its lowest point since last July.

Source: Xinhua, June 13, 2013