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Economy to grow 7% in Q2 - think tank

By Wang Xu (China Daily)
Updated: 2009-05-05 08:09

The economy is likely to expand 7 percent in the second quarter - up from the first quarter's 6.1 percent, a top government think tank said Monday.

... "Economic growth will pick up in the second quarter as the government's stimulus measures gradually take effect," the State Information Center (SIC) forecast. ...

... "The Chinese government has been extremely successful in stimulating investment," said Eric Fishwick, CLSA head of economic research. "We hope that firmer domestic demand, as government spending gains traction, will keep the PMI above 50 in the months to come." ...

... Consumer spending held fast over the past months, despite looming unemployment pressure. About 2.68 million vehicles were sold in the first quarter, making the nation the world's largest auto market during the period.

Housing sales surged 23.1 percent by value while retail sales rose 15.9 percent in the first quarter, 3.6 percentage points higher than the same period a year earlier. ...

... "It's still too early to say the economy is experiencing a real recovery," said Zhu, the SIC economist. "Over the past months, local enterprises have been running down their inventories. Now they have to reduce overcapacity." ...