China Investment March 2017


China: Investment accelerates markedly in Q1

April 17, 2017

In the first three months of the year, urban fixed-asset investment (FAI), excluding rural households, expanded 9.2% annually, which was above the 8.9% increase in the January-February period. The print exceeded the 8.8% increase expected by market analysts and represented the strongest growth in 10 months. The acceleration in the January-March period was the result of a strong performance in the primary and secondary sectors, while activity in the tertiary sector steadied. The closely-watched real estate development indicator expanded at the fastest pace in two years, suggesting that dynamics in the property sector remain buoyant.

Analyzing January-March’s data from the ownership side, investment growth among state-owned and state-holding units remained strong but decelerated to an over one-year low. Conversely, activity among private companies accelerated from a 6.7% increase in the first two months of the year to a 15-month high of a 7.7% rise in Q1.

A month-on-month comparison shows that investment in urban fixed assets rose a seasonally-adjusted 0.87% in March, slightly above the 0.86% increase in February.

The government set a growth target of 9.0% for urban fixed-asset investment for this year. FocusEconomics Consensus Forecast participants expect fixed-asset investment to grow 8.5% in 2017, which is up 0.2 percentage points from last month’s Consensus. In 2018, the panel sees fixed-asset investment growth at 7.9%.

Author: Ricard Torné, Lead Economist

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China Investment Chart

China Investment March 2017

Note: Month-on-month changes of seasonally adjusted urban fixed-asset investment index and annual growth rate (year-to-date) in %.
Source: National Bureau of Statistics of China (NBS).

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