A leading indicator for China's economic performance recorded no change in March after a notable growth in the previous month, suggesting that the economic momentum is waning with the government tightening its grip on the real estate sector.
The leading economic indicator (LEI) remained unchanged at 258.3 in March, following a 1.2 percent increase in February and a 1.7 percent rise in January.
The LEI signals that "what little steam the economy was enjoying is already dissipating," said Andrew Polk, resident economist at the Conference Board China Center in Beijing.
"Falling real estate activity, a result of the government tightening the noose on purchases, was the main culprit," Polk added.
In addition to the existing property market controls, some local governments in China have introduced or are planning to implement fresh property curbs this month by increasing the down payments for second home buyers and imposing tax on capital gains from property.
The Conference Board's coincident economic index, which measures current economic activity, declined 0.2 percent in March to 236.1. This followed a 2.9 percent increase in February and a 0.3 percent decline in January.
The decline was due to "significantly weaker industrial activity, and is in line with the moderation in economic growth in the first quarter of this year," Polk said. A slew of economic indicators released earlier this week pointed to weaker growth momentum in the economy.
China's economic growth slowed in the first quarter of 2013 after accelerating for the first time in two years in the fourth quarter of 2012. The gross domestic product expanded 7.7 percent in the last quarter, the National Bureau of Statistics said Monday.
Leading international agencies have indicated that the economy is likely to grow at a slower pace than earlier predicted. The International Monetary Fund cut its 2013 growth forecast for China this week to 8 percent from the 8.2 percent forecast previously. The outlook for 2014 was lowered to 8.2 percent from 8.5 percent.
The World Bank cut its 2013 growth outlook for the economy to 8.3 percent from the previously projected 8.4 percent. Chinese GDP is set to expand 8 percent in 2014, according to the World Bank report.
The Asian Development Bank expects China to grow 8.2 percent this year on the back of rising domestic demand and improved exports. However, ADB expects growth to edge back slightly to 8 percent in 2014, as the government moves to cool pressure on the environment and to address income inequality.
The government aims to achieve 7.5 percent GDP growth this year after a slowdown in growth to a 13-year low of 7.8 percent in 2012.
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April 24, 2026 15:15 ET Economics news flow was relatively light this week even as the conflict in the Middle East continued, raising concerns for policymakers. In the U.S., spending data, initial jobless claims and pending home sales were the highlights. Business confidence in the biggest euro area economy was in focus in Europe. Inflation data from Japan gained attention in Asia.