Check out what’s being clicked on FoxBusiness.com
Data on Tuesday showed China’s economy grew faster than expected in the first quarter, giving officials some relief as they work to maintain growth.
The government has announced fiscal and monetary policy measures to achieve the target of approximately 5% GDP growth in 2024. Analysts called this an ambitious goal and noted that last year’s 5.2% growth rate was likely driven by a rebound in the economy. 2022 – Faced with restrictions due to COVID-19.
According to data released by the National Bureau of Statistics, GDP increased by 5.3% in the January-March period compared to the same period last year. This beat the 4.6% increase expected by analysts polled by Reuters and was slightly faster than the 5.2% rise in the previous three months.
Jeff Ng, Head of Asia Macro Strategy at SMBC (Singapore), said: “This is a positive outcome for achieving our economic goals. It proves that an upside to the March data is not surprising. “For now, momentum appears to be stable.”
Yellen says China’s overcapacity requires ‘tough conversations’
China’s economy grew faster than expected in the first quarter, data showed on Tuesday. (Keith Tsuji/Getty Images/Reuters Photo)
“I think sentiment remains bearish. We expect some kind of reversal, probably starting in the last quarter of 2024,” he added.
Quarterly GDP growth rate in the first quarter was 1.6%, higher than the expected 1.4%.
China’s economy, the world’s second-largest, has struggled to make a strong and sustained jump post-pandemic, battered by a prolonged real estate recession, rising local government debt and weak private sector spending. There is.
Fitch last week downgraded China’s sovereign rating outlook to negative, citing risks to the Chinese government’s finances as it allocates more spending to infrastructure and high-tech manufacturing amid a shift away from the real estate sector.
With consumers cautious about spending and businesses lacking confidence to expand, governments are counting on infrastructure improvements to help boost the economy.
China’s consumer inflation fell more than expected in March as producer price deflation continued.
Biden review committee slams Microsoft for Chinese hack targeting US officials: ‘A cascade of avoidable errors’
Data showed industrial production rose 4.5% in March from a year earlier, compared with expectations for a 6% rise and a 7% rise in January-February. (Reuters/Reuters Photo)
Although the economy got off to a strong start in 2024, March data on exports, consumer inflation and bank lending showed momentum may be slowing.
Separate data on factory output and retail sales released at the same time as the GDP report also showed a slowdown in momentum.
Industrial production in March rose 4.5% year-on-year, compared to the expected 6% increase and 7% increase in January-February.
Retail sales growth in March was 3.1% compared to the same month last year, slowing down from the 5.5% increase in the January-February period, compared to the expected 4.6% increase.
Fixed asset investment grew by 4.5% annually in the first three months of 2024. In contrast, the forecast showed an increase of 4.1%. In the January-February period, it expanded by 4.2%.
“At first glance, the headline numbers look strong…but I actually think the late momentum is quite weak,” said Alvin Tan, head of Asian currency strategy at RBC Capital Markets in Singapore.
The Chinese government has high hopes for infrastructure development to revitalize the economy. (Reuters/Reuters Photo)
CLICK HERE TO GET FOX BUSINESS ON THE GO
The crisis in the real estate sector is a major setback for China’s economy, with ripples affecting business and consumer confidence, investment plans, hiring decisions, and stock prices.
The People’s Bank of China has said it will increase policy support for the economy this year.
Analysts expect bank reserve requirements and interest rates to be further reduced.
The U.S. Federal Reserve and other advanced economies have shown no urgency to start cutting interest rates, further setbacks in policymakers’ efforts for a strong economic recovery, and China is also expected to see below-average export growth. There is a possibility that it will be prolonged.
Reuters contributed to this report.
