China's "first quarterly report" on the economy will release a number of leading indicators that exceed expectations

(Economic Watch) China's "first quarterly report" on the economy will release a number of leading indicators that exceeded expectations

Beijing, 4 Apr (ZXS) -- China's economic report card for the first quarter will soon be released. Some recent leading indicators show that the stabilization and recovery of China's economy in the first two months of this year has continued into March, and some areas have performed more than expected.

Under the condition that the global economic growth prospects are not optimistic, many parties expect China's external demand to be under pressure this year, but the foreign trade data in the first quarter showed full resilience.

Data map: Aerial photograph of Jiangxi Ganzhou International Dry Port. Photo by Liu Lixin, reporter of China News Agency

In the first quarter, the total import and export value of China's trade in goods was 9.89 trillion yuan (RMB, the same below), an increase of 4.8% year-on-year, and the growth rate was 2.6 percentage points faster than that in the fourth quarter of last year. Among them, exports were 5.65 trillion yuan, a year-on-year growth rate of 2.0% from an increase of 9.8% in the previous two months.

It is particularly noteworthy that in the first quarter, the total export of China's electric manned vehicles, lithium batteries and solar cells "new three" products increased by 66.9%, with a year-on-year increase of more than 1000 billion yuan, raising the overall growth rate of exports by 2 percentage points, further strengthening the driving force over last year. In the same season, China's "new three things" have export records to more than 200 countries and regions around the world.

According to the analysis of the Bank of China Research Institute, China's export growth rate in March far exceeded market expectations, and the release of the backlog of pre-orders, the return of export orders for labor-intensive products, and the strong competitiveness of new advantageous products were the main reasons. However, there is still uncertainty in the current international demand, and we should remain cautiously optimistic about the future export trend. In order to achieve the goal of promoting stability and improving the quality of foreign trade throughout the year and continue to play the role of exports in supporting the economy, the policy combination needs to be more accurate and effective.

Also exceeding expectations was financial data. According to the People's Bank of China, RMB loans increased by 10.6 trillion yuan in the first quarter, an increase of 2.27 trillion yuan year-on-year. Among them, in March, RMB loans increased by 3.3 trillion yuan, an increase of 89.7497 billion yuan year-on-year.

Zhou Maohua, a macro researcher at the financial market department of China Everbright Bank, described the credit performance in March as "both supply and demand". In terms of sub-sectors, new credit of enterprises maintained expansion, residents' credit continued to recover, and the growth rate of residents' savings slowed down, reflecting the recovery of enterprise and residents' confidence, the continued expansion of corporate investment, and the recovery of residents' consumption and housing demand. From a macro perspective, China's economic recovery momentum has increased.

Pang Ming, Chief Economist and Director of Research Department of JLL Greater China, also pointed out that China's new credit has improved significantly, comprehensively and beyond expectations in terms of volume and structure. However, the repair of household consumption still needs various policy support and protection, including financial policies, orderly expand the scale of financial support consumer credit, and steadily reduce the cost of personal consumer credit to boost residents' consumption capacity and willingness.

As an important leading indicator to observe economic changes, China's purchasing managers' index (PMI) extended its expansion trend in March, which also released positive signals.

In the same month, China's manufacturing PMI was 51.9%; The non-manufacturing business activity index and the composite PMI output index were 58.2% and 57.0%, respectively. The three major indexes have been in the expansion range for three consecutive months, indicating that China's economic development is still stabilizing and recovering. Zhang Yu, assistant director and chief macro analyst of Huachuang Securities Research Institute, believes that the composite PMI output index continued to rise in March, and China's economic performance may exceed expectations.

This continued recovery momentum has also provided "reassurance" for enterprises. In China's manufacturing PMI in March, the expected index of production and business activities was 3.55%, which continued to be in a high economic range. From the perspective of industry, the expected index of production and business activities of all industries surveyed has been in the boom range for two consecutive months, among which food and wine and beverage refined tea, special equipment, railway, ship, aerospace equipment, electrical machinery and equipment and other industries are in the high prosperity range of more than 5.60%, and relevant enterprises are optimistic about the market development prospects.

In the case of a series of leading indicators releasing warmth, the Bank of China Research Institute judged that in the first quarter, as the impact of the epidemic subsided significantly, the policy of stabilizing the economy was deployed forward, China's economy continued to recover, production and demand both improved, employment and prices were generally stable, and market confidence and expectations improved significantly. It is expected that in the second quarter, China's economy will fully enter the post-epidemic recovery period. (End)