China's GDP Witnessing 4.5% YoY Growth, Exceeds Predictions

China's economy grew faster than expected in the first quarter, expanding 4.5 percent year on year, according to official data released on Tuesday (Apr 18), as policymakers seek to boost growth following the end of strict COVID-19 curbs in December.

Analysts polled predicted that gross domestic product (GDP) would grow 4% year on year, up from 2.9 percent in the fourth quarter.

GDP increased by 2.2 percent in January to March, according to data released by the National Bureau of Statistics, compared to expectations for a 2.2 percent increase and a revised 0.6 percent increase in the previous quarter.

Recent data indicate that the economy is recovering from the disruptions caused by the abrupt lifting of COVID-19 curbs in December, with consumption, services, and infrastructure leading the way, but easing inflation and surging bank savings raise concerns about the strength of domestic demand.

After falling short of the 2022 target, the government has set a modest target of 5% economic growth for this year.

Going forward, Pang cautioned that policy support and targeted easing are still needed to secure sustainable growth amid external uncertainties.

In the first quarter, the total retail sales of consumer goods rose 5.8 percent year on year. Notably in March, consumer spending surged 10.6 percent year on year, 7.1 percentage points higher than that in the first two months.

The investment in fixed assets grew by 5.1 percent year on year in the first quarter while the total added value of large industrial enterprises grew by 3.0 percent in the same period.

China has set a GDP growth target of around 5 percent for this year. Local governments around the country are gearing up support for the economy including optimizing the business environment, stabilizing employment and promoting consumption.