Goldman Sachs China Proprietary Economic Indicators: February
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Goldman Sachs provides an update on its proprietary high-frequency economic indicators for China through February. The China Current Activity Indicator (CAI) rose to +4.6% month-over-year annualized in December, up from +4.5% in November, with the improvement primarily led by the manufacturing sector. However, an import-implied domestic demand proxy indicates that domestic demand remains weak.
The MAP surprise index, measured on a 21-day moving average basis, suggests recent macroeconomic data have fallen short of market expectations. The manufacturing growth proxy declined in December, while the construction growth proxy ticked up slightly. Meanwhile, the investment tracker indicates a slowdown in real value-added growth to approximately 1.9% during the fourth quarter.
China's Financial Conditions Index tightened marginally in December, driven by trade-weighted currency appreciation, though this was partially offset by credit easing. Without further policy easing, Goldman Sachs estimates the growth impact of the credit impulse will turn negative in 2026. December also recorded the largest foreign exchange inflows in history.
Domestic macro policy proxies tightened slightly due to the credit component. The augmented fiscal deficit marginally expanded on both 3-month and 12-month moving average bases, while the fiscal spend-through ratio declined. City-level property indicators continue to signal sustained housing policy easing.