Neil Shearing, Group Chief Economist at Capital Economics says that the latest set of economic figures from China suggests that the economy has begun to find its feet.

• Last week’s release of activity data for March showed that, having slowed for the best part of a year, conditions in the world’s second-largest economy are now starting to improve. This follows an improvement in March’s trade data (released earlier this month) and, before that, a rebound in China’s manufacturing PMIs.
• All of this reinforces a point that our China team has been making for a while – namely that policy support would ultimately put a floor under the slowdown in growth that began in mid-2018.
• Policymakers in Beijing are more cognisant now than in the past of financial vulnerabilities stemming from rising debt levels. Accordingly, the scale of policy stimulus this time has been much smaller than in previous downturns. Beijing has done enough to stabilize the economy but investors betting on a vigorous recovery in growth are likely to be disappointed.