China's GDP grows slowest in 10 years

BEIJING: China���s economy, battered by collapsing exports, grew at the slowest pace in almost 10 years, probably marking its low point. Gross domestic product expanded 6.1% in the first quarter from a year earlier, after a 6.8 % gain in the previous three months, the statistics bureau said in Beijing.

A 30% surge in urban fixed-asset investment in March and a jump in industrial output, both reported on Thursday, added to evidence that the government���s 4 trillion yuan ($585 billion) stimulus plan is working. Premier Wen Jiabao cautioned that while the world���s third-biggest economy is in better-than- expected shape, China is yet to establish a solid foundation for a recovery.

���They���ve stabilized the economy and now the challenge is to think about how to support consumption and how to support private investment,��� said Stephen Green, head of China research at Standard Chartered Plc in Shanghai.

���We���re still looking for stimulus measures to encourage consumption.��� The report follows a statement from US Treasury Secretary Timothy Geithner that China isn���t a currency manipulator. His stance eases pressure on China to allow its currency to rise, which would hurt efforts to revive exports.

While stimulus measures have started to produce results, China faces faltering export demand, industrial overcapacity, unemployment and weak private investment sentiment, Wen said in a statement after a meeting of China���s cabinet.
Industrial output expanded 8.3% in March from a year earlier, up from 3.8% in the first two months. Retail sales rose 14.7%. Consumer prices fell 1.2% in March from a year earlier, compared with a drop of 1.6% in February. Producer prices fell 6%, the most since Bloomberg data began in 1999.

China���s expansion was the weakest since the fourth quarter of 1999, according to Bloomberg data, and less than the 6.2% median estimate of 13 economists.