GDP rises 6.8% from year earlier in first quarter; jobless rate down

Indicating the Chinese economy remained resilient at the start of the year, the nation's GDP registered solid growth in the first quarter, expanding by 6.8 percent year-on-year, the National Bureau of Statistics said on Tuesday.

GDP reached 19.88 trillion yuan ($3.17 trillion) in the first three months.

"The economy is off to a good start," NBS spokesman Xing Zhihong said at a news conference. "The national economy has maintained stable development momentum."

The GDP growth rate has been within the range of 6.7 percent to 6.9 percent for straight 11 quarters, with the jobless rate remaining at low levels.

The NBS data showed that retail sales helped shore up stable growth, climbing by 9.8 percent in the first quarter.

Fixed-asset investment increased by 7.5 percent in the same period, down by 0.4 percentage point from the January-February period.

Industrial output growth reached 6.8 percent in the first quarter, down by 0.4 percentage point from the first two months.

The NBS also said that the surveyed unemployment rates in the first three months were 5 percent in January, down by 0.2 percentage point year-on-year; 5 percent in February, down 0.4 percentage point from a year earlier; and 5.1 in March, down 0.1 percentage point year-on-year.

"First-quarter GDP data is on the positive side," said Zhu Haibin, chief China economist of J.P. Morgan. "It reduced the concern that economic activity has slowed down. If you look at domestic activity indicators, they are holding up very well," he told Reuters.

Despite weak fixed-asset investment growth, real estate development investment increased by 10.4 percent year-on-year in the first three months, beating market expectations and climbing by 0.5 percentage point from the first two months, the NBS said.

Growth of investment in real estate development shows that developers remain upbeat about future sales, said Liu Dongliang, an economist of the China Merchants Bank. "Bolstered by strong real estate investment growth, fixed-asset investment will not slump as some have worried about."

The first-quarter data show that China's economic resilience remains and investors should not become pessimistic toward the country's growth prospects, although the whole-year GDP growth may ease mildly, said Liu. "It is not hard for China to achieve its GDP growth target for this year, and currently we do not see the possibility of China easing monetary policy (to support growth)."

China set a GDP growth target of 6.5 percent for this year in March.

But Liu warned that some factors, such as possible escalation of China-US trade disputes and the easing growth of infrastructure investment due to regulatory tightening on bank loans, should be closely monitored in judging the growth trend in the second quarter.

Liu Yuanchun, an economist and vice-president of Renmin University of China, said China needs to prepare for uncertainties such as possible export shocks from China-US trade disputes and domestic debt. "External and internal uncertainties may worsen economic fluctuations and cause changes in market expectations."

Wang Yanfei contributed to this story.