The Chinese economy continued to consolidate its fast recovery from the Covid-19 pandemic with the country’s factory and retail sector activity growing in the forts two months of the current year which beat expectations of analysts.
However according to analysts, the very low base from the massive slump last year made the number that were released on Monday look impressive. At the same time they also noted the resting recovery of the Chinese economy.
Data from the country’s National Bureau of Statistics showed that in the first two months of the current year, there was a 35.1 per cent year on year growth in the industrial output of the economy compared to the 7.3 per cent year on year growth in December of 2020. That was higher than a median forecast of a 30.0 per cent growth according to a Reuters’ poll of analysts.
There was also a 33.8 per cent year on year growth in retail sales which was higher than a forecast of 32 per cent growth which marked a significant rise from the 4.6 per cent year in year growth in the month of December 2020 and a contraction of 20.5 per cent year on year in the first two months of 2020.
"We have a positive outlook for exports and manufacturing investment this year," said Louis Kuijs, head of Asia economics and Oxford Economics. "And we expect household consumption to become a key driver of growth from Q2 onwards as confidence improves and the government’s call to reduce travel is toned down."
This rebound of China was possible because of the country’s ability to bring the Covid-19 pandemic under control much faster than any other major economy could.
With an annual growth of 2.3 per cent, China was the only major economy to report economic growth in 2020.
Strong trade, pent-up demand and government stimulus have driven the recovery of the Chinese economy.
While growth in factory gate prices for February was the highest since November 2018, the growth in exports also touched a record in the same month.
Typically the week-long Lunar New Year holiday, which fell in February in 2021, distorts the economic activity of China in the first two months of any year.
While the above data presents a statistical noise, a broad-based recovery was also signalled by other data which included a 16.9 per cent growth in industrial output and a 6.4 per cent growth in retail sales in the first two months of the current year compared to the same period of 2019.
The foundation for the Chinese economic recovery is not yet solid even though there were increasing factors for China's economy, said Liu Aihua, an NBS spokeswoman.
"Covid-19 is still spreading around the world and global economic conditions are complex and severe; domestically the imbalances of the recovery are still quite obvious," Liu told a briefing in Beijing.
Earlier this year, there was re-emergence of scattered Covid-19 outbreaks in China but those were quickly brought under control.
(Source:www.hindustantimes.com)
However according to analysts, the very low base from the massive slump last year made the number that were released on Monday look impressive. At the same time they also noted the resting recovery of the Chinese economy.
Data from the country’s National Bureau of Statistics showed that in the first two months of the current year, there was a 35.1 per cent year on year growth in the industrial output of the economy compared to the 7.3 per cent year on year growth in December of 2020. That was higher than a median forecast of a 30.0 per cent growth according to a Reuters’ poll of analysts.
There was also a 33.8 per cent year on year growth in retail sales which was higher than a forecast of 32 per cent growth which marked a significant rise from the 4.6 per cent year in year growth in the month of December 2020 and a contraction of 20.5 per cent year on year in the first two months of 2020.
"We have a positive outlook for exports and manufacturing investment this year," said Louis Kuijs, head of Asia economics and Oxford Economics. "And we expect household consumption to become a key driver of growth from Q2 onwards as confidence improves and the government’s call to reduce travel is toned down."
This rebound of China was possible because of the country’s ability to bring the Covid-19 pandemic under control much faster than any other major economy could.
With an annual growth of 2.3 per cent, China was the only major economy to report economic growth in 2020.
Strong trade, pent-up demand and government stimulus have driven the recovery of the Chinese economy.
While growth in factory gate prices for February was the highest since November 2018, the growth in exports also touched a record in the same month.
Typically the week-long Lunar New Year holiday, which fell in February in 2021, distorts the economic activity of China in the first two months of any year.
While the above data presents a statistical noise, a broad-based recovery was also signalled by other data which included a 16.9 per cent growth in industrial output and a 6.4 per cent growth in retail sales in the first two months of the current year compared to the same period of 2019.
The foundation for the Chinese economic recovery is not yet solid even though there were increasing factors for China's economy, said Liu Aihua, an NBS spokeswoman.
"Covid-19 is still spreading around the world and global economic conditions are complex and severe; domestically the imbalances of the recovery are still quite obvious," Liu told a briefing in Beijing.
Earlier this year, there was re-emergence of scattered Covid-19 outbreaks in China but those were quickly brought under control.
(Source:www.hindustantimes.com)
