Chinese growth moderates to 7.4%
- China’s GDP growth slowed to its lowest level in 18 months in Q1, moderating to 7.4% on year from 7.7% in Q4 but topping forecasts for 7.3%. The figure is below the government’s target of 7.5%, although the country’s leaders have indicated that the goal is flexible as they try to implement reform.
- Falling momentum in investment and consumption, struggling real estate, and weak external demand were among the main factors that caused the slower expansion.
- On quarter, GDP +1.4%, as expected, vs +1.8%.
- The value of home sales fell 7.7% in Q1 to 1.1T yuan ($177B); new property construction -25% to 291M square meters (3.1B square feet).
- Industrial production +8.8% in March +8.6% in previously and consensus of +9%.
- Retail sales +12.2% vs +11.8% and +12.1%.
- Urban fixed-asset investment +17.6% in Q1 vs +17.9% previously and forecasts of +18.1%.
- MNI Business Sentiment Indicator 51.1 in March vs 50.2 in February.
- "All the forward-looking indicators are weak - growth is going to continue to slow," says Standard Chartered’s Stephen Green. "We expect a mix of moderate monetary easing over the next few months and more aggressive reform measures."
- However, Credit Agricole economist Dariusz Kowalczyk expresses a bit of optimism. “The silver lining is that retail sales and industrial output both rebounded in March, suggesting that growth is bottoming out.”
Japanese industrial production drops 2.3% in February
- Japanese industrial output fell 2.3% on month in February, as expected, after rising 3.8% in January.
- On year, production +7% vs +10.3%.
U.K. jobless rate drops below 7%; wage rises in line with inflation
- U.K. unemployment for the three months to February fell to 6.9% from 7.1% previously and came in under forecasts that were also 7.1%.
- Average earnings including bonuses accelerated to +1.7% from +1.4% but missed expectations of +1.8%. Still, the figure brings wage growth in line with inflation of 1.7% after a long period in which salary rises remained well below CPI growth.
Eurozone monthly inflation rises
- Eurozone CPI accelerated to +0.9% in March from +0.3% in February, but missed consensus of +1%.
- On year, inflation fell to 0.5% (flash 0.5%) from 0.7%.
- Core CPI moderated to +0.7% from +1% and vs forecasts of +0.8%.