Chinese authorities to release first quarter economic growth data
China’s economic growth data for the three months to March will be released today. The figure is expected to confirm economists’ estimates that the economy grew by 1.4%—China’s lowest quarterly growth rate since 1992.
China experienced an economic slowdown in Q1 due to declining exports amid ongoing trade tensions with the US. In response, the Chinese government announced a flurry of stimulus measures last month, including a 3% decrease in the value-added tax rate for manufacturing firms and $163 billion dollars in infrastructure spending to boost domestic demand and offset a slowing external environment.
Also released today will be data on China’s industrial output, retail sales and fixed asset investment in March. Policymakers in Beijing will point optimistically to these figures to show the resilience of domestic demand, but any positive indicator will likely be skewed by the quick boost of the government’s stimulus package.
However, it is too early to turn any short-term relief into long-term optimism. China’s economic data will only confirm what was seen from prior GDP releases this quarter—that the global slowdown is more significant and persistent than expected. Furthermore, stimulus measures will conflict with Beijing’s goal of reducing its role in the economy and are likely to prove increasingly ineffective over time.
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