China has been one of the major causes for concern in global equity markets this year. China GDP growth numbers remain solid, but the economic community has a general mistrust about the accuracy of China’s self-reported numbers.

In a new report, ANZ Research analyst Li-Gang Liu took a close look at China’s GDP numbers to see just how reliable they are.

New Era Of Transparency

Now that China has begun compiling its GDP numbers in-line with IMF standards, analysts like Liu are able to get a closer look at the numbers behind China’s calculation. China’s officially-reported Q3 GDP growth number was 6.9 percent, but some analysts have speculated that the real number was actually 5.0 percent or lower.

China’s Estimate Reasonably Close

According to Liu, China’s 6.9 percent growth estimate is within a reasonable margin of error of the number that ANZ came up with. Liu noted that the extremely high growth in the financial industry has been driven by elevated levels of financial service turnover. The financial industry alone contributed 1.4 percent of the 6.9 percent Q3 GDP number.

Cause For Concern?

Liu noted that China’s services sector has ballooned to account for more than 50 percent of GDP. ANZ believes that the world should be watching China’s services sector closely. “China observers should also adopt a new perspective in gauging its economic condition,” Liu added.

The iShares FTSE/Xinhua China 25 Index (ETF) (NYSE: FXI) is down 23.1 percent in the past six months.

Disclosure: The author holds no position in the stocks mentioned.