China: Early signs of green shoots – Nordea Markets


According to Amy Yuan Zhuang, chief analyst at Nordea Markets, China’s better-than-expected GDP numbers show stabilisation of the economy, but it’s too early to call for a turnaround.

Key Quotes

“The Chinese economy showed welcoming signs of stabilisation in Q1, thanks to increased government stimuli. GDP growth was 6.4% y/y, on par with the last quarter and beating both our and consensus expectation. However, the quarterly numbers offer another perspective. The economy grew by 1.4% q/q, lower than 1.5% in Q4. This indicates that growth momentum had indeed suffered at the beginning of this year.”

“Other growth barometers, such as industrial output, fixed investments and retail sales, have all exceeded expectation for March. Together they paint a much brighter macro picture for China and help easing growth concerns. Nevertheless, it is too early to declare a convinced turnaround of the economy.”

“Today’s numbers support our financial forecasts. While we think the authorities will maintain an accommodative stand on growth policies, there is currently no need to cut the benchmark interest rates, which stand at 4.35% for one-year lending rates and 1.5% for one-year borrowing rates.”

“The improved macro numbers support our call for no sharp movements of the CNY/CNH against the USD in the near term.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD trims early gains, dangerously close to 1.1200

The positive tone of the pair fades in the American afternoon as demand for the dollar resumes, despite softer-than-expected US data. All eyes on the Fed this week.

EUR/USD News

GBP/USD extends decline, pierces 1.2550

Despite moving in slow-motion, GBP/USD decline is continuous with the pair trading at levels last seen in January, amid political uncertainty weighing on Sterling.

GBP/USD News

USD/JPY remains directionless above mid-108s on Monday

The USD/JPY pair is struggling to make a decisive move in either direction on Monday as the slightly upbeat market sentiment doesn't allow the safe-haven JPY to gather strength.

USD/JPY News

Gold remains on track to close with small losses below $1340

The XAU/USD pair, which closed higher on the weekly chart for the fourth straight time last week, is fluctuating in a relatively tight range on Monday amid a lack of significant fundamental drivers that had a lasting impact on the greenback's market valuation or the risk perception.

Gold News

Gold: Signs of bullish exhaustion ahead of the Fed

Gold's rally seems to have run its course with signs of bullish exhaustion emerging on technical charts ahead of Wednesday's FOMC (Federal Open Market Committee) rate decision.

Read more

Majors

Cryptocurrencies

Signatures