🇨🇳❗️Cable FX Macro Weekly Note: China October Retail Sales, IP

**As seen in Risk In The Week report 11/10/23, subscribe at cablefxm.co.uk/reports 

September economic indicators strengthened arguments for a China rebound, retail sales expanded by 5.5% Y/y vs the prior 4.6% and above market expectations of 4.9%, and industrial output topped estimates of 4.4% as it recorded a 4.5% Y/y increase. The data batch included China's 3Q GDP growth, the economy accelerated by 4.9% vs the consensus median of 4.5%, the upside surprise puts the Chinese economy on track to meet its growth target this year. Looking closer at September data from the NBS, the month saw mining and manufacturing output softness relative to August, while the energy industry recorded an uptick. Consumers' auto sales strength extended, and office supplies showed another contraction. Clothing, restaurant, and jewelry sales show double-digit increases this year. Unsurprisingly, construction materials sales are the softest component, as it is tracking a YTD drop of 7.9%. Economists at J.P. Morgan mentioned that the continuous strength in retail sales reflects an improvement in labor market conditions and a decline in household savings rates, the latter dropped to 29% in 3Q vs 32% in 1H 2023. J.P. Morgan noted alternative indicators showing solid momentum from travel-related activities during the Golden Week Holiday, they stand in line with the consensus and expect retail sales to rise 7.0% Y/y. Lastly, JPM keeps their 4Q 2023 GDP Growth forecast at 5.5%, they expect output to expand by 5.2% this year, and flag risks of a slower growth trend for 2024.