China’s Q1 GDP growth beats forecasts, rises 6.9 pct y/y

Data published by the National Bureau of Statistics (NBS) on Monday showed that China’s Q1 2017 GDP grew by 6.9 percent y/y, beating forecasts for a 6.8 percent rise. On an annualized basis, China’s growth slowed it pace of expansion, coming in at 19 percent versus 1.7 percent last.

Credit surge likely fueled stronger investment and industrial activity. Despite efforts by authorities to crack down on debt risks, China's total social financing, a broad measure of credit and liquidity in the economy, reached a record 6.93 trillion yuan ($1 trillion) in the first quarter.

Central and local governments spending rose 21 percent from a year earlier. Higher government infrastructure spending and persistent property boom helped boost industrial output by the most in over two years. Industrial production also speeds up to 6.8 percent y/y in Q1 2017, up from a 6.0 percent growth for 2016.

Separate data showed China’s retail sales Y/Y came in at +10.9 percent vs 9.7 percent expected and compared to 9.5 percent in the previous month. Industrial output Y/Y came in at 7.6 percent more than 6.2 percent expected and 6.3 percent last. Meanwhile, urban fixed asset investment Y/Y stood at +9.2 percent vs 8.8 percent expected and 8.9 percent last.