中国经济：一季度超出预期，但复苏仍不均衡

Q1 beat but recovery remained uneven Frank Liu(852) 3761 8957frankliu@cmbi.com.hk Q1 GDP growth rebounded and came in better thanmarketexpected, whilearecovering GDP deflator points to a possible first positivereading in 2Q26 aftermore than three years of deflation. Industrial output and fixed asset investmentwere robust, supported by exports and fiscal expansion, while retail sales,especiallydurable goods, and service output moderated in Mar, as growthofhousehold real disposable income dropped to 3 years’ low.The property sectorremained in contraction, despite showing limited signs of recovery as sales andprices among tier-1 cities bounced up. Higher energy prices may help narrowdeflation throughupstream cost pass-through, but this is still cost-push ratherthandemand-led and may squeeze downstream margins and household GDPreboundedin 1Q26while GDP deflator recovered.China’s GDPgrowth in YoY terms (all on a YoY basis unless otherwise specified) rose to5.0% in 1Q26 from 4.5% in 4Q25, while nominal GDP growth improved to4.9%, implying the GDP deflatorhas notably improvedto-0.1%from-0.6%in 4Q25.We may finally see a positive deflator in 2Q26 after 14 quarters ofdeflation cycle due to the rising commodities pricesin upper-stream sectors.However, the stronger Q1 reading was mainly supportedbyrobustexports,afirmer industrial cycleandstabilizingfixed asset investment, rather than a Source:Wind, CMBIGM Property sectorshowed improving signs.The contraction ofgross floorarea (GFA) sold forcommoditybuildingsnarrowed to-10.4% YTD in 3M26from-13.5%in2M26.Newstarts stayed weak at-20.3% and total fundingsources fell 17.3%, dragged by a 20.1% drop in advance receipts and a34.6% decline in mortgage loans.New housing sales inthefirst half ofAprnotably rebounded to 13.5% from-6% in Marby GFAdue toa lower baselast year, as tier-1 cities surged by 35.5%. The recovery ratio of 30 majorcities compared to 2018-2019, however,fell to 46%in Apr from 52% in Mar.Second-hand housing sales of 11 selective cities moderately reboundedinearly Apr,with YoYGFAgrowthpickingup to 9.63% from-4.2% in Mar, whiletherecovery ratiodropped to 114% from 127%.New andsecond-hand Retail salesmoderatedafter the holiday lift faded.Retail sales growthslowed to 1.7% in Mar from 2.8% in 2M26, lower than market expectations at2.5%. Catering growth moderated to 2.9% in Mar from 4.8% in 2M26, whilefood, beverage, apparel and jewelry still held up relatively well at 9.5%, 8.2%,7.0% and 11.7%, respectively. By contrast, policy-sensitive and housing-related categories weakened again, with home appliances, furniture, building boost and subsidy pull-forward.Moreover, growth of per capita disposablerealincomeof households dropped to 4% in 1Q26, the slowest in 3 years.Looking ahead, we still expect consumption growth to staymutedin 2026,with softer goods consumption partly offset by a gradual recovery in services. FAIedged down.Fixed asset investmentdropped 1.4% YoY in Mar afterrising 1.8% in 2M26, in line with market expectations.Property investmentwas still the main drag at-11.3%in Mar, reflecting continued oversupply,weak sales and tight funding conditions. Manufacturing investment improvedto 4.9% inMarfrom 3.1% in 2M26, supported by general equipment, autos,transportequipment and computer,communication and electronicequipment, while high-tech industry investment rose 7.4%. Infrastructureinvestment eased to7.2% inMarfrom 11.4% in 2M26, but remained solid,with transportation, utilities and public facility spending still supported by earlyfiscal funding. Looking forward, investment should continue to rely on fiscal Industrial output stayed resilientthanksto robust export delivery value. VAIO growthedgeddownto 5.7% in Mar from 6.3% in 2M26,still higher thanmarket expectations at 5.4%.1Q26 cumulative growthpicked up to6.1%, stillabove the 2025 full-year pace of 5.9%. Manufacturing remained the mainanchor, with cumulative growth at 6.1% in 1Q26from 5% in 4Q25,asexportdelivery value accelerated to 8.7% in Mar from 6.3% in 2M26, showing thatexternal demand was still providing support.Chemicals, transport equipmentand electronics stayed relatively strong, while non-metallic mineral productsremained weak, indicating domestic construction demand was still soft. The March data argue for a more cautious reading of the Q1 rebound. Activity in Q1 was better than feared, but the composition still looks driven byexports,manufacturing and fiscal-driven FAIrather than a self-sustaining risein household and property demand. The slowdown in Marbig-ticketretailsales and servicessuggests the economy has not yet built a durabledomestic-demand cycle. Higher energyandcommodityprices may reducedeflation pressure at the margin, but the benefit is likely to bepartlyoffset byweaker real purchasing power and margin pressure downstream.Middle Source: Wind, CMBIGM Source: Wind, CMBIGM Source: Wind, CMBIGMNote:The 11 cities include Beijing,Shenzhen,Hangzhou,Nanjing,Chengdu, Qingd