China Q1 GDP grows 6.8%, slightly more than expected

China Q1 GDP grows 6.8%, slightly more than expected

Workers help to dock a cargo ship at a port in Qingdao
Workers help to dock a cargo ship at a port in Qingdao, Shandong province. (File photo: Reuters/China Daily)

BEIJING: China's economy grew 6.8 per cent in the first quarter of 2018 from a year earlier, official data showed on Tuesday, slightly above expectations and unchanged from the previous quarter.

The data points to continued resilience in the world's second-largest economy even as its export outlook is being clouded by escalating tensions with the United States, its largest trading partner.

Analysts polled by Reuters had expected gross domestic product (GDP) to expand 6.7 per cent in the January-March quarter, slowing only marginally from 6.8 per cent growth in the previous two quarters.

Growth remained comfortably above the government's target of around 6.5 per cent for the full year, which could give policymakers more confidence to step up efforts to reduce risks in the financial system and clean up the environment.

On a quarterly basis, GDP in the first quarter grew 1.4 per cent, compared with revised growth of 1.6 per cent in October-December, the National Bureau of Statistics said.

Analysts had expected growth of 1.5 per cent on a quarterly basis.

"The national economy maintained the momentum of steady and sound development," said Xing Zhihong, a spokesman for the National Statistics Bureau.

"The economic performance continued to improve and the economy was off to a good start."

China's sustained growth shows the economy has remained resilient even as Beijing kicked its war on pollution into a high gear during the winter months by cutting production for many steel smelters, mills and factories.

Fears of a trade war with the US have also roiled markets in recent weeks, with Washington and Beijing exchanging warnings of tit-for-tat tariffs on a significant portion of their bilateral trade.

The tensions have yet to cause real harm to the economy, analysts say, but that may change in coming months when tariffs threatened by US President Donald Trump are expected to be implemented.

Along with exports, debt-fuelled investment has driven China's economy over the last decade - but with fears growing over a possible credit crisis, officials in Beijing are stepping up their battle against debt and financial risk.

Output at China's factories and workshops expanded by 6.8 per cent year-on-year in the first quarter, below the 6.9 percent forecast by Bloomberg News. Industrial production grew by 6 per cent in March.

Source: CNA/Agencies/rw