China’s economy exceeded expectations in the first quarter, driven by policies and increased demand, the government announced on Tuesday. The country’s economy grew at a rate of 5.3% in January-March, surpassing analysts’ forecasts of 4.8%. This growth represented a 1.6% increase from the previous quarter.
Despite struggles to recover from the impact of the COVID-19 pandemic, China experienced better-than-expected economic performance in the first quarter. The growth was supported by a 6.1% increase in industrial output, a 4.7% growth in retail sales, and a 4.5% rise in fixed investment compared to the same period last year.
Economist Louise Loo of Oxford Economics attributed the first quarter’s strong growth to manufacturing outperformance, increased household spending during the Lunar New Year holidays, and supportive policies for investment. However, Loo cautioned that indicators in March and unpredictable external demand conditions could lead to weakness in the second quarter.
Policymakers in China have implemented various fiscal and monetary measures to stimulate the economy and achieve a GDP growth target of 5% for 2024. The government is focused on sustaining economic growth while navigating challenges such as a property crisis and fluctuations in demand.