China’s economic growth slowed further in the latest quarter but appeared strong enough to satisfy Chinese leaders who are trying to put the country on a more sustainable path without politically dangerous job losses. The world’s second-largest economy grew 7.4 percent from a year earlier in the January-March quarter, down from the previous quarter’s 7.7 percent, government data showed Wednesday. It matched a mini-slump in late 2012 for the weakest growth since the 2008-09 global crisis. Beijing is trying to guide China’s economy toward growth based on domestic consumption instead of trade and investment following the past decade’s explosive expansion. The top economic official, Premier Li Keqiang, last week ruled out new stimulus and said leaders will focus on “sustainable and healthy development.” “Chinese growth held up better than expected last quarter and there are signs that downwards pressure on growth has eased somewhat,” said analyst Julian Evans-Pritchard of Capital Economics in a report. Retail sales and factory output were weaker than in the previous quarter but improved in March. On a quarter-to-quarter basis, economic growth from January to March slowed to 1.4 percent from the previous period’s 1.8 percent. The data reflect official efforts to shift emphasis from investment-intensive industry to services such as restaurants and retailing that generate more jobs.
Credit growth slowed in March and the expansion of China’s overall money supply rose at its slowest rate since 1997. Housing sales in the first quarter declined 5.7 percent from a year earlier. “The continued slowdown in money and credit growth is likely to keep exerting relentless downward pressure on China’s economic growth,” said Societe Generale economist Wei Yao in a report. “Without re-acceleration of debt growth, the economy is unlikely to stabilize for another quarter at least.” Stock markets in Asia and Europe were mostly higher, shrugging off the Chinese figures because growth didn’t slow as much as forecast by analysts. The latest economic growth is below the official annual target of 7.5 percent announced last month. But Chinese leaders appear willing to miss that target so long as the economy creates enough jobs to avoid potential unrest. In a sign of concern about employment, they launched a mini-stimulus in March of higher spending on building railways and low-cost housing. More