According to Nomura’s Chief China Economist Zhiwei Zhang, among the 32 indicators he tracks, nearly two-thirds showed faster growth in May than April.
“Having a mix of negative and some positive data are typical at turning points in the economy, and indeed our conviction remains strong that the second quarter is the bottom of the economic downswing,” Zhang said. “There are also signs that the policy easing has started to gain traction through the month of June.”
At the same time, new bank loans in June rose 16 percent to 919.8 billion yuan ($144.3 billion) from May’s 793 billion yuan ($124.4 billion) and April’s 682 billion yuan ($107 billion), the People’s Bank of China said on Thursday, in a sign government efforts to spur the country’s slowing economy may be working.
This means that the second quarter was as bad as it got, Zhang said. He’s forecasting the economy will rebound to 8.6 percent in the third quarter and 8.9 percent in the fourth quarter, translating to an expansion of 8.4 percent for the whole of 2012, Zhang said.
Other indicators are showing an uptick in economic activity in China. Power output, an alternative gauge of industrial activity, rose in May, according to the latest available data from China Electricity Council. The country generated 389.8 billion kilowatt hours (kWh) of electricity in May, up 2.7 percent over the previous year. That compares to growth in electricity generation of just 0.7 percent in April.