China's economy has grown at a faster-than-expected pace in the first quarter, as the end of strict COVID-19 curbs lifts businesses and consumers out of crippling pandemic disruptions, although headwinds from a global slowdown point to a bumpy ride ahead.
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More than a year-long sweeping streak of global monetary policy tightening to rein in red-hot inflation has dented world economic growth, leaving many countries including China reliant on domestic demand to spur momentum and raising the challenge for policymakers looking for post-COVID stability.
Gross domestic product grew 4.5 per cent year-on-year in the first three months of the year, data from the National Bureau of Statistics showed on Tuesday - faster than the 2.9 per cent in the previous quarter.
It beat analyst forecasts for a 4.0 per cent expansion and marked the strongest growth in a year.
Investors have been closely watching first-quarter data for clues on the strength of the recovery after Beijing lifted COVID curbs in December and eased a three-year crackdown on tech firms and property.
GDP growth last year slumped to one of its worst in almost half a century due to COVID curbs.
"Economic recovery is well on track. The bright spot is consumption, which is strengthening as household confidence improves," said Zhiwei Zhang, chief economist at Pinpoint Asset Management.
"The strong export growth in March also likely helped to boost GDP growth in Q1."
Chinese policymakers have pledged to step up support for the $US18 ($A27) trillion economy to keep a lid on unemployment, but they face limited room to manoeuvre as businesses grapple with debt risks, structural woes and global recession worries.
China's rebound has so far remained uneven as its investment-fuelled growth of the past to one now reliant on consumption faces challenges.
Consumption, services and infrastructure spending have perked up but factory output has lagged in the face of weak global growth, while slowing prices and surging bank savings are raising doubts about demand.
China's exports unexpectedly surged in March, data showed this week, but analysts cautioned the improvement partly reflects suppliers catching up with unfulfilled orders after last year's COVID-19 disruptions.
"On net, that's a decent set of figures out from China in Q1, which keeps them on track for their growth target of around 5.0 per cent this year," said Matt Simpson, senior market analyst at City Index.
On a quarter-on-quarter basis, GDP grew 2.2 per cent in January-March, in line with analyst expectations and up from a revised 0.6 per cent rise in the previous quarter.
Asia's shares pared losses on Tuesday after the data, with Hong Kong's Hang Seng Index down 0.4 per cent in early trade while China's bluechip CSI300 Index gained 0.3 per cent.
The nation's central bank said last week it would maintain ample liquidity, stabilise growth and jobs and focus on expanding demand.
The government, which has refrained from taking big steps to spur consumption, is still relying heavily on infrastructure spending to spur investment and economic growth.
Analysts polled by Reuters expect China's growth in 2023 to speed up to 5.4 per cent, from 3.0 per cent last year.
Australian Associated Press
