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It’s easy to get excited about a 23% boost in China’s retail sales for the month of July, the highest rate since February 1996. But let’s not forget that despite China’s growth profile it still only accounts for 17% of Asian GDP (and 5% of world GDP). While we’re seeing Olympic-fueled growth rates out of China, the rest of Asia is hitting the skids.

South Korea’s three largest department stores just posted the slowest growth rate in 5 months -- with July’s 5.9% at less than half the prior month’s rate. Hong Kong’s GDP rose 4.2% (down from 7.3%) -- the slowest rate in 5 years due to slower consumption and exports. Perhaps the biggest nugget is Japan, which posted a 12.9% yy decline in department store sales of clothing. This is the second weakest reading on record in recent history (-16.5% in March 1998), and the weakest 3 month trend in at least 30 years.

What happens if China cools? Let’s hope the Olympic hangover is a short one.