China’s economy grew faster than expected in the first quarter, but official data revealed a decline in consumer activity as decommissioning measures to counter the proliferation of Covid-19 weighed on the country’s prospects.
China’s gross domestic product rose 4.8 percent compared to the same period last year, after growing 4 percent in the last three months of 2021. On a quarter-on-quarter basis, GDP grew 1.3 percent.
Retail sales, a measure of consumer spending, fell 3.5 percent in March – its first drop since July 2020 – as authorities tightened restrictions to address the country’s worst coronavirus outbreak in more than two years.
The data will increase pressure on Chinese President Xi Jinping’s government, which has reaffirmed its commitment to a zero-Covid policy despite rising costs and disruption in the country’s largest cities. Infections across China rose in April, and Shanghai, its main financial hub, has largely remained closed.
Lockdown effect: That lockdown in Shanghai began at the end of March, which means that its full effect will not be recorded in the first quarter report, which took into account less severe shutdowns at the Shenzhen and Jilin production hubs.
Wealthy looking to leave: Chinese immigration consultants say inquiries from wealthy people trying to leave has increased following the closure of Shanghai, underscoring frustration over Beijing’s zero-Covid strategy.
What do you think of Beijing’s zero-Covid strategy? Share your thoughts with me [email protected]. Thank you for reading FirstFT Asia. – Emily
The latest from the war in Ukraine
Five more stories in the news
1. Gold rises to the highest level in a month Gold prices rose and US equities fell on Monday as concerns over one weakening of the global economy was amplified by signs that coronavirus lockdowns had clouded the outlook for growth in China.
2. Whiskey on the table as Johnson heads to New Delhi Leading Scottish producer Chivas Brothers says it aims to double exports to India if New Delhi removes whiskey tariffs, there is a huge UK demand in bilateral trade negotiations ahead of Prime Minister Boris Johnson’s visit to India this week.
The President of Sri Lanka appoints new leaders President Gotabaya Rajapaksa appointed 17 cabinet members yesterday as protests over alleged economic mismanagement continue to shake the nation. Rajapaska elected younger leaders to appease the public, but his 76-year-old brother, Mahinda Rajapaksa, remains prime minister. (Straits Times)
Marine Le Pen rejects reports of misuse of EU funds The French right-wing extremist presidential challenger Marine Le Pen has rejected claims that she signed tens of thousands of EU funds as “dirty tricks” from the EU less than a week away from a close election campaign against Emmanuel Macron.
5. The UK was preparing for a longer period of stagflation The risk of a longer period of low growth in gross domestic product combined with high inflation in the UK has increased after consumer prices rose more than expected while economic growth slowed to a crawl.
ONE American judge has stopped The Biden Administration’s mask requirement for passengers in public transport.
China’s zero-Covid policy has taught the world that it is no longer possible, if ever, to fight the virus alone with repression. Ways to live with the virus must be found, writes our editors.
That number of births in advanced economies have largely returned to prepandemic levels, shows an FT analysis – a recovery, partly due to stimulus policies.
The day ahead
Indonesia’s central bank meeting Politicians in Bank Indonesia will meet and make their interest rate decision.
Johnson is facing parliament A defiant Boris Johnson will meet lawmakers for the first time since he was fined for the “partygate” affair, in which allies privately criticize the Metropolitan Police’s handling of the issue. The British Prime Minister wants that sorry to MPs but will insist he was not aware he was breaking his own Covid-19 lockdown rules.
IMF World Economic Outlook As inflation reached a new high of 40 years in the US and a high of 30 years in the UK this week, the IMF said that its forecasts to be published today will also show rapid price increases would be more persistent than previously thought.
Join FT’s crypto and digital assets summit on 26-27. April. Sign up today to be part of a critical conversation with the world’s global finance and corporate elite as they pave the way for bridging the gap between traditional finance and tomorrow’s crypto leaders.
What else do we read
US-China Tech Race: Shock and Awe In the latest episode of this Tech Tonic season on technology rivalry between the US and China, FT US-China correspondent Demetri Sevastopulo tells the inner story of his scoop on China’s secret hypersonic weapons test and how it changed geopolitics.
Asian Americans take security into their own hands after violent attacks Since the pandemic, anti-Asian hatred in the United States has escalated. Amanda Chu talks to Asian Americans in New York City, where the police department estimates that hate crimes against them increased by more than 360 percent in 2021.
OK, boomer: generations are not right. Class is. Desperate individuals – like marketers or columnists who have exceeded their deadline – love to talk about “generations” because they are nice ways to sell someone something they would not otherwise buy, writes Stephen Bush. For more from Stephen, sign up here to our latest newsletter, Inside Politics.
India’s largest merger ever The proposed merger of DKK 40 billion USD between India’s largest private bank and mortgage lender has been driven by tighter regulation of the country’s shadow banking sector, Deepak Parekh, chairman of HDFC Bank and Housing Development Financing Corporation, told FT.
Donald Trump and the Republicans’ midterm dilemma The Republican Senate’s primary election in Pennsylvania next month is becomes a crucial event at this year’s midterm elections, and be able to decide which party controls the upper house of Congress. US President Joe Biden defeated Donald Trump in 2020 in the state, but only by a knife-thin margin.
Hard luxury drives the retail market because watches and jewelry tend to retain or even increase their value. But historically, clothing has been a bad investment, losing about 90 percent of its value when purchased. But a boom in online retail and changed attitudes to used has given rise to large online marketplaces for second-hand goods.