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China Just Reported Weaker-Than-Expected Quarterly Economic Growth

An investor walks past a digital board showing stock market movements at a brokerage house in Shanghai. Photograph by Johannes Eisele—AFP/Getty Images

China’s economy expanded 1.1% in the first quarter of 2016 from the fourth quarter of last year, National Bureau of Statistics data showed, missing analysts forecasts.

The slower-than-expected quarterly growth rate comes amid other signs the Chinese economy is stabilizing in the first quarter, including positive surprises from trade, inflation, output and credit.

Analysts had expected quarterly growth of 1.5% for the first quarter, but the statistics bureau did not release quarterly figures when it issued annual figures on Friday.

“The 1.1% growth rate clearly illustrates that China’s economy still faces downward pressures,” Zhou Hao, senior economist at Commerzbank, wrote in a research note on Monday.

“If we calculate the seasonally adjusted GDP growth based on the qoq numbers, we find that there is a big gap (0.4 percent point) between headline GDP growth (non-seasonally adjusted) and the seasonally adjusted GDP growth. As economists, we always prefer the seasonally adjusted qoq numbers, which better tell the underlying growth momentum,” he added.

China’s economy grew 6.7% year-on-year in the first quarter in 2016, and 6.9% for the whole of 2015. That is the slowest rate since 2009, but the pace applies to a much larger economy—around $10 trillion in 2015.


Over the weekend, the statistics bureau also revised 2015 quarterly growth figures for three quarters.

In the first quarter of 2015, quarterly growth was revised upwards to 1.4% from 1.3%. In the second quarter, it was revised downwards to 1.8% from 1.9%, while in the fourth quarter, quarterly growth was revised downwards to 1.5% from 1.6%.

The 2015 third quarter quarterly economic growth figure remained unchanged.

The statistics bureau also revised quarterly growth figures for 2014 in two quarters. For the first quarter, the quarterly figure was revised upwards to 1.7% from 1.6%, and in the third quarter, the figure was revised upwards to 1.9% from 1.8%.

The 2014 quarterly economic data for the second and fourth quarters remained unchanged.

Some China watchers, nevertheless, suspect that real growth levels could be much lower than what the official data suggest.