China’s Q1 GDP slowdown as expected, more stimulus likely

BEIJING  - While China’s first quarter GDP growth moderated to 7.4% y/y from 7.7%  in the previous quarter, in line with expectations, in sequential terms, the slowdown was more pronounced, at 1.4% q/q sa from 1.7% q/q sa in Q4, according to BBVA Bank. “The weak GDP outturn reflects subdued exports,” BBVA said.

“Activity indicators released today for March were also relatively weak, including industrial production and fixed asset investment. Notwithstanding some recently unveiled stimulus measures, the weakening trend in growth suggests that authorities need to do more to maintain full year growth within their comfortable zone (above the 7.0% bottom line).
“We expect more growth-supportive measures in coming weeks, which could gradually bolster growth momentum in the second half of the year and underpin full year growth marginally above the floor target.” www.bbvaresearch.com (ATI).