China takes interesting turn

Still growing but are clouds brewing?

China's economy is definitely anchored what's been happening in Asia, and for that matter, has helped stabilized output around the world. In fact, the Economist recently noted that GDP in 2Q grew at an estimated 16.5% in the quarter just ended, according to Goldman Sachs. See A second look at China and GDP.

However, China's central bank has highlighted some of the risks to the expansion and a torrent of data that just hit suggests its concerns warrant some attention.

According to Bloomberg News, industrial production is still rising, albeit at a slower pace, but exports, which helped to drive growth earlier in the decade, remain weak as demand from the world's largest economies has yet to fully revive.

Lending plunged to $52 billion, a quarter of June's level, and fixed investment, though up an astounding 32.9% versus one year ago, missed expectations and appears to have rolled over, which is a little worrisome given it is a sign of spending by the government.

Taken together, the economy is still expanding but is not yet on a firm foundation and any tightening by the central bank will likely be delayed. Following the reports, commodity prices, including copper, are under pressure.