Investing.com – China’s economy managed to sustain its momentum despite recent regulatory crackdowns that aimed to reduce risks in the financial system, as data from the National Bureau of Statistics showed the country’s industrial output and investment grew faster than expected in the first two months of the year.
Economists and analysts have previously expected the momentum to slow down this year, but the data seemed to suggest that China’s economic growth remained robust.
Industrial output rose 7.2% y/y in the first months of the year, beating the general consensus of 6.2%. Fixed asset investment also came in higher than expected, jumping 7.9% y/y versus the estimate of 7.0%.
“Strong industrial output and investment reflect a more powerful economy than expected, backed up by credit growth in January and robust demand,” said Shen Jianguang, chief Asia economist at Mizuho Securities Asia Ltd. in Hong Kong.
However, the data should be treated with caution, as they may be subject to distortions caused by the timing of the week-long Lunar New Year holidays, which started in late January in 2017 but in mid-February this year.
The impacts of the data on regional equities seemed to be limited though, with the Shanghai Composite and the Shenzhen Component both trading 0.4% lower by 1:20am ET. Hong Kong’s Hang Seng Index fell 1.3%, snapping a 4-day advance.
Meanwhile, retail sales growth for the month was marginally slower than expected, rising 9.7% compared to the estimated 9.8%. Premier Li Keqiang said at the National People Congress last week that the country is aiming a GDP growth of around 6.5% in 2018.