A big stack of official Chinese economic data was released over the weekend and it paints a somewhat mixed picture of the country in 2013. The short version is that some growth indicators were significantly weaker than expected, but others beat consensus forecasts - and consumer inflation appears to be on the rise again, even when the new year effect is discounted. This comes after strong export growth and weak import data surprised everyone late last week. Like we said, it's mixed. But we think Credit Suisse summed it up best: This set of macro-data showed that fixed asset investments continued to be the key driving factor; this is consistent with our view of a narrow-based recovery. So far, there is no evidence that the growth momentum that has been primarily driven by local government investment projects has spilled over to other sectors. Industrial production growth has soften again, this is in-line with our expectation, and without a broader-based improvement of activities, a strong rebound of growth momentum will likely still be missing. So let's go through some of the highlights. NB: most of the points below except where specified are referring to combined January-February data, to smooth the New Year effect. Industrial production and electricity output, came in lower than expected: However total fixed-asset investment - a big source of China's notoriously capital-intensive growth - was stronger than expected. This was mostly thanks to the property investment component; manufacturing FAI actually decelerated more than expected: Credit growth was huge, despite the pullback in February after January's massive credit surge. Here is the society-wide financing, aka total social finance or the government's preferred measure of credit. It includes some - but obviously not all - non-bank lending: There are a few ways of looking at this. Michael Werner from Bernstein Research says the relatively low February growth is mostly due to: 1) a normalization in credit growth after the record January issuance and 2) the negative impact of Chinese New Year. Credit Suisse strategists say that, as far as bank loans are concerned, the PBoC "hit the brakes" on bank loans after the January surge, sending officers around to commercial banks "to monitor and restrict lending activities, which usually happens during times of "overheating"." CS also point out that February total social financing growth of Rmb1.07tn was 9.7 per cent higher than January 2012 (when last year's Chinese New Year fell). So to inflation, which is one of the biggest risks to China's more-of-the-same recovery, with its extremely high dependence on credit and investment growth. It's getting a little dicey: consumer inflation grew 3.2 per cent in February, compared to 2 per cent in January. That exceeded the 3 per cent consensus, prompting Standard Chartered to say that inflation is back: And yes the February figure was no doubt influenced by Chinese New Year, but StanChart's China strategists point out that taking the averaged Jan-Feb growth rate (2.6 per cent) still gives a figure 0.5 percentage points above the average of the previous three months. Furthermore, they believe pork prices (which in February were negative, year-on-year) are likely to pick up again soon, based on the hog cycle and the pork-corn price ratio. So what to make of it all? Well, Nomura (as discussed here) has a very different take to Standard Chartered, even though both have maintained for some time now that inflation will be a problem in 2013. Nomura is even more cautious about 2013 growth, saying that potential growth is no higher than 7 - 7.5 per cent and could be even lower. StanChart is sanguine; pointing to positive signs in the producer confidence, outlook and inventory. The more bullish strategists at HSBC and BAML both believe the rising inflation seen in February won't be a problem. For us the most interesting data from January/February relate to credit growth, inflation, and trade. What these show in March could be revealing about China's economic course this year. Most of the other data point to a rough continuation of the same "narrow-based recovery," as Credit Suisse put it - only, perhaps a little slower than some were expecting at this point. Related links: New Year blamed for China imports dip - FT