China CNY

China Industrial Capacity Capacity Utilization

Info

History

Chart

Impact:

Medium

Source: National Bureau of Statistics of China

Latest Release:

Date:

Surprise:

1.2%

CNY

Actual:

78%

Forecast: 76.8%

Previous/Revision:

76.8%

Period: Q4

What Does It Measure?

The China Industrial Capacity Utilization Rate measures the extent to which the manufacturing sector's capacity is being utilized in relation to its potential output. It primarily focuses on production efficiency and industrial activity, assessing the proportion of total production capacity that is being used, with key indicators often reflecting levels above or below 75% indicating healthy economic performance, while rates consistently below this threshold suggest underutilization or economic slack.

Frequency

The data for the Industrial Capacity Utilization Rate in China is typically released on a monthly basis, with the figures often presented as preliminary estimates before final revisions are made in subsequent months.

Why Do Traders Care?

Traders closely monitor the capacity utilization rate as it provides insights into economic health and manufacturing sector performance, influencing investment decisions and market perceptions. Stronger-than-expected figures can buoy sentiments leading to bullish trends in equities and the Renminbi, while disappointing results may have a bearish impact on these assets.

What Is It Derived From?

This indicator is calculated using surveys of industrial firms in China, assessing their current output levels against their potential production capacity. The calculations may involve data collection methodologies including diffusion indices that factor in production levels and capacity broadly, offering a comprehensive view of industrial efficiency.

Description

The capacity utilization rate is significant for understanding the degree to which the country's industrial capacity is matched with actual production and demand. Preliminary reports based on early estimates might show initial trends, but final data provides more accurate reflections of capacity usage, making this differential critical for investors monitoring industrial output.

Additional Notes

The capacity utilization rate serves as a coincident economic measure, providing immediate insights into manufacturing trends which often correlate with broader economic cycles. It is also useful for comparing with other indicators such as industrial production and manufacturing PMI, offering a fuller view of economic activity in China.

Bullish or Bearish for Currency and Stocks

Higher than expected: Bullish for Renminbi, Bullish for Stocks. Lower than expected: Bearish for Renminbi, Bearish for Stocks.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number	Better than forecast for the currency (or previous revise better)
Red Number	Worse than forecast for the currency (or previous revise better)
Hawkish	Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish	Favors lower rates to boost growth, weakening the currency but lifting stocks.

Date	Time	Actual	Forecast	Previous	Surprise
Jan 19, 2018		78%	76.8%	76.8%	1.2%