Economic growth dips to 7.7%, putting tightening on hold
By Wang Yanlin |
April 16, 2013, Tuesday
|
Print Edition
Print Edition
CHINA'S economy expanded 7.7 percent from a year earlier in the first three months, missing market expectations and putting the country's potential tightening policies on hold.
The pace slowed from last year's final quarter increase of 7.9 percent, the National Bureau of Statistics said yesterday.
Gross domestic product reached 11.88 trillion yuan (US$1.9 trillion) from January through March.
"The easing of China's first-quarter GDP suggests that the country's economic recovery remains fragile," said Zhou Hao, an economist at Australia & New Zealand Banking Group Ltd. "The economy in the near term faces some downside risks, including the outbreak of avian flu, the front-loading effects in the property market and signs of slowed investment momentum ? all of which could sidetrack the second-quarter growth significantly."
Lian Ping, chief economist at Bank of Communications, said the unexpected slowdown will halt the process of tightening policies when the inflationary pressure recedes.
"Policy-makers may retain a neutral policy stance to support growth at the moment, and there is unlikely any interest rate increase in the foreseeable future," Lian said.
The Consumer Price Index, the main gauge of inflation, retreated to an increase of 2.1 percent in March, down from February's 10-month high of 3.2 percent and greatly easing inflationary pressure.
Sheng Laiyun, a bureau spokesman, said: "The growth was achieved amid many uncertainties in the global economy. Judging by the statistics, China has steady employment figures ? the foundation of a stable economy."
He attributed the slowdown to unfavorable external situations and China's active undertaking of macroeconomic control.
In the first three months, industrial production grew 9.5 percent on an annual basis, down 2.1 percentage points from the same period of last year.
Fixed-asset investment jumped 20.9 percent, flat compared to a year earlier, and retail sales rose 12.4 percent, slower than the 14.8 percent increase a year earlier, the bureau said.
Disposable income of urban residents added 9.9 percent to 6,220 yuan in the first quarter, while rural household income climbed 12.5 percent to 2,107 yuan on average.
"There is no basic change in the economy as China's acceleration in urbanization, industrialization and globalization can create huge development potentials," Sheng said.
The bureau's data showed that among the 7.7 percent growth in the first three months, consumption contributed 4.3 percentage points, investment 2.3 points and net exports 1.1 points.
The service industry expanded 8.3 percent in the January-March period, leading the manufacturing sector which gained 7.8 percent and the agriculture sector which had increased by 3.4 percent.
The pace slowed from last year's final quarter increase of 7.9 percent, the National Bureau of Statistics said yesterday.
Gross domestic product reached 11.88 trillion yuan (US$1.9 trillion) from January through March.
"The easing of China's first-quarter GDP suggests that the country's economic recovery remains fragile," said Zhou Hao, an economist at Australia & New Zealand Banking Group Ltd. "The economy in the near term faces some downside risks, including the outbreak of avian flu, the front-loading effects in the property market and signs of slowed investment momentum ? all of which could sidetrack the second-quarter growth significantly."
Lian Ping, chief economist at Bank of Communications, said the unexpected slowdown will halt the process of tightening policies when the inflationary pressure recedes.
"Policy-makers may retain a neutral policy stance to support growth at the moment, and there is unlikely any interest rate increase in the foreseeable future," Lian said.
The Consumer Price Index, the main gauge of inflation, retreated to an increase of 2.1 percent in March, down from February's 10-month high of 3.2 percent and greatly easing inflationary pressure.
Sheng Laiyun, a bureau spokesman, said: "The growth was achieved amid many uncertainties in the global economy. Judging by the statistics, China has steady employment figures ? the foundation of a stable economy."
He attributed the slowdown to unfavorable external situations and China's active undertaking of macroeconomic control.
In the first three months, industrial production grew 9.5 percent on an annual basis, down 2.1 percentage points from the same period of last year.
Fixed-asset investment jumped 20.9 percent, flat compared to a year earlier, and retail sales rose 12.4 percent, slower than the 14.8 percent increase a year earlier, the bureau said.
Disposable income of urban residents added 9.9 percent to 6,220 yuan in the first quarter, while rural household income climbed 12.5 percent to 2,107 yuan on average.
"There is no basic change in the economy as China's acceleration in urbanization, industrialization and globalization can create huge development potentials," Sheng said.
The bureau's data showed that among the 7.7 percent growth in the first three months, consumption contributed 4.3 percentage points, investment 2.3 points and net exports 1.1 points.
The service industry expanded 8.3 percent in the January-March period, leading the manufacturing sector which gained 7.8 percent and the agriculture sector which had increased by 3.4 percent.
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