China's QI GDP growth solid but let down by March data

Continuing weak demand at home slowing economy’s overall momentum

China's economy grew faster than expected in the first quarter, data on April 16 showed, offering some relief to officials as they try to shore up growth in the face of protracted weakness in the property sector and mounting local government debt.

However, a raft of March indicators released alongside the gross domestic product (GDP) data-including property investment, retail sales and industrial output showed that demand at home remains weak and is retarding overall momentum.

The government has unveiled fiscal and monetary policy measures in a bid to achieve what analysts have described as an ambitious 2024 GDP growth target of around 5 per cent, noting that last year's growth rate of 5.2 per cent was likely flattered by a rebound from a Covid-19-hit 2022.

GDP grew 5.3 per cent in January to March from the year earlier, data released by the National Bureau of Statistics showed, comfortably above analysts' expectations in a Reuters poll for a 4.6 per cent increase and slightly faster than the 5.2 per cent expansion in the previous three months.

"The result is positive for the economy to hit its target. Momentum appears to be stable for now, evidenced by the March data not surprising on the upside," said Mr Jeff Ng, head of Asia macro strategy at SMBC in Singapore.

"I think sentiments are still leaning towards bearish. I'm anticipating some reversal, possibly from the last quarter of 2024." On a quarter-by-quarter basis, GDP grew 1.6 per cent in the first quarter, above the forecast for growth of 1.4 per cent.