China's economy shows growth as COVID-19 disruptions ease

China's first-quarter gross domestic product (GDP) rose by 4.5 per cent, outperforming the forecast of 4 per cent, as the country lifted COVID-19 restrictions that shut its borders for nearly three years.

This marks the highest growth since the first quarter of 2022 when China's economy expanded by 4.8 per cent, according to China's National Bureau of Statistics.

The economy grew 2.2 per cent quarter-on-quarter.

Retail sales jumped 10.6 per cent in March as online sales of physical goods picked up. Industrial output rose 3.9 per cent, slightly lower than Reuters’ forecast of 4 per cent.

Year-to-date fixed asset investment rose 5.1 per cent compared to a year ago, but it was weaker than expected as growth slowed in infrastructure and manufacturing investment.

Meanwhile, real estate investment continued to decline.

In 2022, China's economy grew by 3 per cent, which was lower than Beijing's official target of around 5.5 per cent set in March last year. For 2023, the government set a modest growth target of "around 5 per cent".

China's services sector also rebounded in the first quarter as the value of the sector rose by 5.4 per cent compared to a year ago. The index of services production rose 9.2 per cent, led by accommodation, catering and information technology services in March.

Despite the positive figures, some economists have warned that China's economic recovery could take longer than expected, with Citi pushing back its target for the Hang Seng index by three months.