If only this leak is correct.

Reuters is citing three unnamed people who report that a government official told an investment conference that May consumer prices rose at an annual rate of 3.1%, exports jumped 50% in the month, and new loans totaled $92 billion.

If those numbers are correct, then investors can tune down fears that the euro debt crisis and China’s own efforts to rein in inflation have slowed China’s economy by a notch. It won’t be possible to discern a strong positive trend in the numbers, I’d guess, but the leaked figures at least don’t show a strong negative trend either. And in the current situation that’s a significant plus for financial markets.

Beijing’s official inflation target for 2010 is 3.0%. (For another indicator of when to get into Chinese stocks see my post https://jubakpicks.com/2010/06/07/when-to-buy-chinas-stocks-my-leading-indicator-still-looks-positive-for-july-but-the-reading-is-foggier/ )  

Bloomberg tried to confirm these numbers with the People’s Bank of China and with government sources. Officials declined to comment. 

All this is par for the course in the often bewildering world of Chinese economic statistics. The government is set to announce trade data on June 10 and the consumer price index on June 11.

Figuring out what these leaked or official numbers means for the long run will require more quarters of data. Building any kind of trend line off one month or one quarter’s data is likely to be completely misleading.

The numbers just aren’t definitive enough.

For example, the leaked monthly new loan figure is down about 18% from April’s loan figure. But it would be useful to know what’s happening with money supply. The consensus among economists is that the money supply, measured by M2, in May will have grown by 21% from May 2009. That’s the slowest rate of growth in 15 months but 21% is still wildly inflationary.

But the drop in lending and in the money supply might have been enough—along with a bushel of new regulations—to slow runaway real estate prices. Economists estimate that prices jumped 12% in May. That would be down from the record 12.8% gain April but 12% would still show an overheated real estate market.

And how about GPD growth as a whole? First quarter growth came in at 11.9% and everyone agrees that was too hot. The consensus now is that second quarter growth will be between 10% and 11%.

That’s slower. But is it slow enough?

Expect a big initial reaction to the official numbers tomorrow and Friday. And then a counter-reaction that’s just about as big when investor’s dig into the contradictory trends.

Full disclosure: I don’t own shares of any company mentioned in this post.