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China's Economic Growth To Begin Slowing Before Long: Capital Economics

Although China's economic activity started strongly this year, the strength is unlikely to be sustained, Julian Evans-Pritchard, a China economist at Capital Economics, said.

Official data released on Monday showed that the economy expanded 6.9 percent in the first quarter, faster than the 6.8 percent growth seen in the fourth quarter of 2016.

The economist observed that the monthly data for March were upbeat. Industrial production jumped 7.6 percent and retail sales climbed 10.9 percent in March, the National Bureau of Statistics reported. Fixed asset investment advanced 9.2 percent in the first quarter.

The economist said the current strength of capital spending still remains heavily reliant on rapid state- led infrastructure investment.

The upbeat data for March suggests that some of this strength will likely extend into the second quarter.

Nonetheless, with property controls starting to bite and the acceleration in credit growth that helped drive the recent recovery now being reversed, the economist still expects the economy to begin slowing before long.

by RTTNews Staff Writer

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