Forecasts for China's CPI, PPI in May

Here are the forecasts for other May macro data coming up this weekend.

May consumer prices are set to be out on Sunday, along with producer prices, fixed asset investment, retail sales and industrial production. Analysts expect CPI to stand at 2.3 percent, slightly lower than in April and Q1. Analysts say economic growth is still tepid, which is reflected by April's six-month low producer price level, with consumer demand weaker than the same period last year. They are concerned about the continued sluggish growth.

On the trade front, financial institutions see single digit growth of both imports and exports in May. Exports' annual growth: 7.3 percent, only half of April's rise, as local authorities tackle "exports" that bring in hot money while import growth may have shrunk to just 6% from April's 17 percent. Because of the sharper slowdown in demand for imported commodities, the trade surplus is expected to have widened.

Meanwhile, institutions lowered their outlooks for May credit supply. We are expecting May lending to come in at 700 billion yuan, lower versus April's reading. If in the ballpark that means an even lower lending figure than in February when the Chinese New Year put a stop to most credit activities. Analysts say, the revised outlook comes from weaker than expected credit demand.