Thanks to the continuous efforts of counter-cyclical adjustment of fiscal and monetary policies, China's economy reversed the trend of declining quarter by quarter last year, with a growth rate of 6.4% in the first quarter slightly exceeding expectations. There are obvious signs of stabilization. The growth rate of investment and consumption has both rebounded. In March, the growth rate of industry reached a four-and-a-half-year high.
The downward pressure of the economy has been significantly reduced, which means that the need for fiscal and monetary policies to continue to intensify in the future has declined. It will enter a quiet observation period and make a choice according to the economic performance in the second quarter. Of course, this does not mean that the policy will be tightened immediately. After all, the situation of economic stability is not easy to come by, and the sustainability needs to be further observed.
"The first quarter of the economy can be said to have a good start, initially reversing the over-pessimistic psychological expectations of the market since the end of last year, reflecting full resilience and stability," said Wang Jun, chief economist of Central Plains Bank. "Short-term economic stability mainly benefits from stronger counter-cyclical adjustment measures."
He pointed out that tax cuts and fee cuts exceeded market expectations, the pace of local debt issuance and fiscal expenditure was also significantly faster than in previous years, the expansion of infrastructure investment hedging economic downturn was stronger, at the same time, social finance and credit growth was faster, credit policy promoted enterprise production and operation to become more active and profits improved. Effective cooperation and synergy between the two policies have effectively promoted the formation of economic stabilization to a better situation.
China's National Bureau of Statistics announced Wednesday that gross domestic product (GDP) grew by 6.4% in the first quarter of this year from a year earlier, higher than the median estimated by Reuters'survey of 6.3%. Investment in fixed assets grew by 6.3% year on year, consistent with the median of Reuters' survey, with private investment increasing by 6.4% year on year.
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