Tip: To personalise the research list, click the gear symbol above.

Choose type:

Fast Comment ChinaStrong economic data confirms policy-driven rebound

  1. GDP growth higher than expected
  2. Less stimulus in the pipeline
GDP growth higher than expected
GDP growth was stable at 6.4 percent y-o-y in Q1 compared to Q4. We and consensus had expected slower growth. The monthly activity indicators showed increased momentum in March with growth of retail sales, fixed investments and industrial production. The latter jumped to the highest level since 2014, which seems odd and might reflect some data distortions. Still, the big picture clearly is that growth is now rebounding due to the many economic policy stimulus measures implemented recently. We had already received a rather clear sign of the rebound from the jump in both manufacturing PMIs in March.
Less stimulus in the pipeline
We have pencilled in a stimulus-driven rebound in GDP growth in Q2. The stronger-than-expected Q1 and March data put upside risk to our forecast for full-year 2019 GDP growth slowing to 6.0 percent from 6.6 percent in 2018. Ironically, the better-than-expected data could spur fear among market participants of less economic stimulus in the pipeline. We remain sceptical as to whether the authorities are willing to boost as much as they have been doing in prior downturns as they are more hesitant to ease to avoid refuelling the credit bubble. We see growth slowing gradually again late this year.



Bjarke Roed-Frederiksen

Senior Economist

Latin America and China

Latest analyses


Morgenmelding Danmark


Fast Comment China


Makroøkonomisk Ugefokus