Quarterly growth is slowest in 20 years, but other data encouraging

China’s economy grew 6.1% year-on-year in the first three months of 2009, down from 6.8% in the fourth quarter of 2008, the Wall Street Journal reported. Although it is the country’s worst quarterly GDP growth in nearly two decades, economists noted that other data suggests the deepest part of the downturn has now passed. China only provides year-on-year comparisons for GDP figures, but Wang Tao, an economist at UBS Securities, estimates that GDP expanded by around 7% in the first quarter from the last quarter of 2008. She expects sequential growth of 12% in the second quarter, as the government’s fiscal stimulus package and credit expansion policy kick in. Industrial production is already looking buoyant, increasing 8.3% year-on-year in March, up from 3.8% in January and February. Fixed-asset investment rose 30.3% in March from a year earlier, compared to 26.5% growth in the first two months of the year. Car sales, home purchases and air travel are all back in positive territory, while retail sales are more or less holding steady. The consumer price index fell 1.2% in March, compared to a 1.6% deficit in February.