The conflicting winds of the global slowdown and a huge domestic stimulus blew through China's economy in January, with exports plunging but bank loans surging, according to a Reuters poll.
The median forecast of 18 economists polled by Reuters is for a 10.8 percent drop in exports in January compared with a year earlier, the sharpest decline in exactly a decade and an acceleration from a 2.8 percent fall in December.
''Despite some recent tentative signs of growth deceleration beginning to moderate, we believe China's growth momentum will remain weak before the influence of policy stimulus kicks in and the external environment improves later this year,'' Goldman Sachs economists said in a research note.
Only a partial list of China's regular economic indicators will be published for January, as the statistics agency puts out January-February numbers for output, investment and retail sales data to smooth out the effects of the Chinese New Year holiday, which falls in January some years and February in others.
The timing of the holiday complicates year-on-year comparisons, but the underlying trends of a slowing economy and a robust government campaign to prop up growth are likely to be borne out in the data.
The deterioration of Chinese aggregate demand will probably be seen in a steep drop in imports, down 28.5 percent in January, according to the poll, compared with a 21.3 percent fall in the previous month.
The resulting trade surplus would be $28.7 billion, considerably narrower than the $39 billion surplus in December.
But loans and money supply probably grew strongly in January as banks answered the government's call to extend credit to struggling firms.
Economists forecast that the broad M2 measure of money supply is likely to have expanded by 18 percent, while new yuan lending probably grew by 19.5 percent.
The official China Securities Journal has already reported that banks extended a monthly record of 1.2 trillion yuan ($176 billion) in new loans in January, following earlier comments by Premier Wen Jiabao that the first 20 days of the month had seen record loan growth.
Bank lending works hand in glove with Beijing's 4 trillion yuan stimulus package, as the government has explicitly called on huge state-owned lenders to provide the financing for much of the spending boost.
China's economy grew 6.8 percent in the fourth quarter compared with the same period a year earlier, weighing down 2008 growth to a seven-year low of 9.0 percent.
The expected surge in January lending has fuelled confidence among Chinese investors, with the country's benchmark stock market index rising solidly this week.
The collapse in global commodity costs probably dragged China's producer prices further into deflation. Economists forecast a 2.6 percent annual drop in the producer price index in January after a 1.1 percent fall in the previous month.
Consumer price pressures, while weakening, are expected to remain mildly inflationary, with food costs picking up because of the New Year holiday. The consumer price index probably rose an annual 0.9 percent in January, down a touch from the 1.2 percent increase in December.