Two Silver Linings To China’s Q1 GDP Growth

There are silver linings to the 8.1% first-quarter GDP growth China has just announced, it slowest year-on-year growth rate in three years, and below expectations. The first is that growth in the final month of the quarter picked up once the early new year distorted first two months were done. That momentum should carry through into the second quarter, particularly I’d the central bank continues to pump credit into the economy as it started to do again last month. The second is that consumption spending’s share of first quarter growth was a high 76% while that of fixed-asset investment fell to a low 20.5%, suggesting a continuing tilt, albeit at slight one, towards rebalancing.