China's economy experienced robust growth in the first quarter of 2024, defying market expectations and signaling resilience amid challenges in the property market. According to data released by the National Bureau of Statistics, the world's second-largest economy expanded by 5.3% on an annual basis, surpassing forecasts for GDP growth of 4.6%. This growth momentum follows a solid performance in the final quarter of 2023 and throughout the entirety of last year.

The first quarter's growth, the strongest since the second quarter of 2023, was attributed to sustained policy support measures and increased consumer spending during the Lunar New Year festivities. The Chinese government's target of around 5% economic growth for 2024, initially viewed as ambitious by analysts, appears more attainable with the current growth trajectory, although challenges remain.

Fixed investment in the January-March period saw a notable increase of 4.5% year-on-year, marking the strongest growth in nearly three years and reflecting continued confidence in the economy. However, despite the overall positive growth figures, recent data on retail sales and industrial production in March indicated some areas of weakness.

Retail sales growth in March fell short of expectations, rising by 3.1% year-on-year, below the anticipated 4.5% increase. This marked the 14th consecutive month of retail sales gains but represented the weakest performance since July 2023. Industrial production growth also slowed in March, registering a 4.5% increase compared to the previous year, lower than the forecasted 5.4% rise.

The slowdown in industrial activity, particularly in the utilities and mining sectors, contributed to the overall decline in industrial production growth. Despite this, long-term investments grew by 4.5% in the first quarter, buoyed by increased investment in the industry.