China's Economic Growth Unexpectedly Held Up in First Quarter
(Bloomberg) -- China’s economy unexpectedly held up in the first three months, as stimulus measures helped arrest a slowdown that’s rattled investors and cast doubt over the global expansion.
Gross domestic product rose 6.4 percent in the first quarter from a year earlier, exceeding economist estimates and matching the previous three months. In March, factory output jumped 8.5 percent from a year earlier, much higher than forecast. Retail sales expanded 8.7 percent, while investment was up 6.3 percent in the year to date.
Pro-growth policies that have been rolled out since last year have helped drive a turn around in consumer sentiment that’s being supported by a nascent recovery in the property market. A stronger-than-expected performance will also add to the debate over whether more stimulus measures are needed this year or if the central bank and finance ministry should now begin paring back their support.
The Shanghai Composite rose, 10-year bond yields climbed, and the yuan and Australian dollar advanced on the bullish numbers.
“If you look at average quarterly growth, we are probably bottoming out already,” Cui Li, head of macro research at CCB International Holdings Ltd. in Hong Kong, said on Bloomberg TV. “In coming quarters, you will see construction, retail sales and investment data all moving up. The numbers say the soft patch is largely behind us.”
Investment by state-owned firms quickened to 6.7 percent and slowed for private firms to 6.4 percent, underscoring the government’s role in supporting growth. Economists forecast a full-year growth rate of 6.2 percent in 2019, down from 6.6 percent last year.
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