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China Growth Slows Slightly In Q1 Amid Signs Of Stabilization

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China's economic growth eased slightly in the first three months of the year amid signs that the momentum in manufacturing, investment and consumer spending was improving, supported by monetary and fiscal stimulus as well as accelerating credit growth.

Gross domestic product grew 6.7 percent year-on-year following a 6.8 percent expansion in the fourth quarter of last year, data from the National Bureau of Statistics showed Friday. The growth figure was in line with economists' expectations. However, the pace of growth was the weakest since 2009.

The Chinese government has set a growth target of 6.5-7 percent for this year. For 2015, the government had targeted about 7 percent growth and the economy achieved a 6.9 percent expansion, which was the least since 1990.

"The overall performance of national economy continued to be stable and move in a positive direction, with structural adjustment deepened, new impetus accumulated and positive changes showed on major indicators," the NBS said in a statement. "The national economy enjoyed a good start."

However, the agency pointed out that the economy was in a critical stage of transformation and the old drivers of growth were being upgraded or replaced with new ones.

"Difficulties on structural adjustment persist and downward pressure on the economy can not be ignored," the NBS added.

Fixed asset investment grew at faster rate of 10.7 percent year-on-year in the first quarter. Investment in real estate rose 6.2 percent and within this, the outlay for residential buildings increased 4.6 percent. Sales of residential buildings surged 60.3 percent in the first quarter.

Exports declined 4.2 percent and imports fell 8.2 percent.

In March, industrial production grew 6.8 percent annually and retail sales increased 10.5 percent from a year ago.

The unemployment rate was 5.2 percent in March, the agency said in a press conference.

"The recent data has been too strong to pin on seasonal factors alone and leave us hopeful that growth has now bottomed out for the time being, with looser monetary and fiscal policy likely to result in a cyclical upturn over the coming months," Capital Economics economist Julian Evans-Pritchard said.

"The upshot is that expectations for a deeper downturn in China this year, which were widespread only a couple of months ago, now appear increasingly misplaced."

Earlier this week, the International Monetary Fund boosted China's growth forecast to 6.5 percent and 6.2 percent for this year and next, respectively.

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