The CEIC Leading Indicator is a proprietary dataset designed by CEIC Insights to precede the development of major macroeconomic indicators and predict the turning points of the economic cycle for key markets. It is a composite leading indicator that is calculated by aggregating and weighting selected leading indicators covering various important sectors of the economy, such as financial markets, the monetary sector, labour market, trade, and industry. It is developed through a proprietary CEIC methodology and employs data from the CEIC database. The CEIC Leading Indicator currently covers eight regions – Brazil, China, India, Indonesia, Russia, the Euro Area, Japan, and the United States.

Robust vehicle production and ample money supply supported China's economic momentum in September, as the CEIC Leading Indicator stayed stable at 109.15, which is almost the same as the August figure (109.04). The strong automobile industry was a key pillar of economic expansion, providing a counterweight to the underperforming real estate sector. With the depreciation of the RMB, the CPI-based real effective exchange rate declined further to 97.97 in September from 98.43 in August, which is expected to support China’s exports in the coming months. Further, an ample money supply is set to ensure smooth financing of business activity.

After a disappointing Q2 2022 with GDP growing only by 0.4% y/y, China's economy rebounded in Q3 2022, growing by 3.9% y/y. However, challenges remain for Q4 as well as Q1 2023 as many provinces across the country continue to report new daily COVID cases and strict containment policies are impacting enterprises as well as the logistics network.

Despite the uncertainties, the smoothed CEIC Leading Indicator increased in September for the 13th consecutive month, suggesting improved growth prospects for the Chinese economy in Q4 2022 as well as into Q1 2023.

Keep informed each month on the predicted turning points of the economic cycle for key markets with our free, proprietary CEIC Leading Indicator. Learn more and register here