China: growth pickup, credit caution
China’s economy appears to have picked up pace in the first quarter, but the recovery looks uneven because loan demand remains weak. An AFP survey reported a Q1 upswing, and some analysts — notably Stephen Jen of Eurizon SLJ — say supportive policy could lift stocks by about 10% this year, yet separate reporting shows credit growth disappointed as households and firms aren’t borrowing much. (wyomingnews.com (bloomberg.com) (larepublica.co)
China’s economy appears to have grown faster in the first three months of 2026, but the rebound is still leaning on exports while borrowing stays soft. (france24.com) (bloomberg.com) Analysts surveyed by Agence France-Presse expected first-quarter growth of about 5.1%, up from 5.0% in the last quarter of 2025, ahead of China’s official gross domestic product release on Wednesday, April 16. The survey said exports helped lift activity even as domestic demand remained weak. (france24.com) March credit data pointed the other way. Bloomberg reported on April 13 that aggregate financing and bank lending missed expectations, with weak demand from households and businesses dragging on credit expansion. (bloomberg.com) (money.usnews.com) Reuters said China’s banks issued 2.99 trillion yuan in new loans in March, below the 3.4 trillion yuan economists expected. Reuters also said broad money and financing growth still looked strong enough for the central bank to avoid rushing into fresh easing. (money.usnews.com) That split fits the policy backdrop in Beijing. China set its 2026 growth target at 4.5% to 5% in March, lower than the roughly 5% goal used in recent years, while raising the budget deficit target to around 4% of gross domestic product. (cnbc.com) (money.usnews.com) The problem is not whether factories can produce more goods. The problem is whether households buy homes and firms borrow to invest, after a long property slump and persistent price weakness pushed consumers and companies to stay cautious. (france24.com) (cnbc.com) Some investors think policy support can still carry markets higher. Bloomberg reported that Stephen Jen of Eurizon SLJ Capital said China had “turned the corner” and forecast about a 10% rise in Chinese stocks by the end of 2026 because valuations remain cheap and policy is supportive. (bloomberg.com) Other data this year have supported the idea of a near-term pickup. Bloomberg reported in March that industrial output rose 6.3% in January and February from a year earlier, the fastest pace since September, as overseas shipments surged at the start of 2026. (bloomberg.com) The next test is whether the official first-quarter data show a rebound broad enough to survive weaker loan demand. If growth beats the target range while credit stays sluggish, Beijing will still face the same question: how to turn export momentum into spending and borrowing at home. (france24.com) (bloomberg.com)
