Connect with us

Business & Finance

China Exceeds Q1 GDP Growth Predictions, Yet Worries Persist about Base Metals’ Future



China's GDP growth beats forecasts in Q1, but concerns linger over base metals' outlook

China’s GDP growth beats forecasts in Q1, but concerns linger over base metals’ outlook. China’s economy expanded at a faster pace than anticipated in the first quarter of 2024, driven by robust growth in the services sector and increased demand from overseas markets. The Chinese government’s policies aimed at stimulating demand were credited for the positive economic performance.

Despite the overall positive growth figures, challenges persist in household confidence and the real estate sector, indicating weaknesses in domestic demand. China has set an ambitious economic growth target of around 5% for 2024, which analysts believe may require additional stimulus measures to achieve.

Efforts to revitalize the property market through monetary and fiscal measures have shown limited improvement, with home prices declining for the 10th consecutive month in March. Retail sales growth in March also fell below forecasted levels, highlighting the ongoing weakness in domestic demand dynamics.

The outlook for industrial metals, heavily influenced by China’s demand dynamics, remains uncertain as the country plays a significant role in global commodity markets. Any revival in domestic demand in China, particularly in the property market, is expected to have a notable impact on base metal prices.

While recent data shows a surge in base metal prices due to manufacturing sector recovery in major economies, the trajectory of base metal demand also depends on the prospect of U.S. Federal Reserve rate cuts. Any delay in the anticipated rate cuts could potentially stall the current rally in metal prices, impacting the global market.

Click to comment

You must be logged in to post a comment Login

Leave a Reply