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China's GDP rate has grown from the last few months.
Population of over 1.3 billion.
Unemployment rate also has a drastic drop.
Inflation is expected to be 1.2% in the year 2017 for the first quarter.
We will be doing our research on topic Unemployment, GDP and Inflation. Unemployment is the number of people who are able and looking for job. GDP is used to measure how well a nation's economy is doing. Inflation is the continuous increase in the general level of prices of the goods and services in the economy.

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Janice

The unemployment rate are expected to drop from 4.1% to 3.97% as this was predicted Friday, May 19, 2017.

The number of employed people also decreased due to the increase in population and the inadequate of their education system.

The employed people rate has dropped to 77,603 due to the retirement age of 50 for women and age 60 for men.

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China Unemployment Rate Forecasts are projected using an autoregressive integrated moving average (ARIMA) model calibrated using our analysts expectations. We model the past behaviour of China Unemployment Rate using vast amounts of historical data and we adjust the coefficients of the econometric model by taking into account our analysts assessments and future expectations. The forecast for - China Unemployment Rate - was last predicted on Friday, May 19, 2017.

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China Unemployment Rate Forecast 2016-2020

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Unemployment Rate in China is expected to be 4.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Unemployment Rate in China to stand at 4.20 in 12 months time.

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Briant

Set its growth target at a lower 6.5 per cent this year

China aims for growth of "around 6.5 per cent, or higher if possible

Use a proactive fiscal policy to support growth

Which means more government spending

Service industries, manufacturing and mining will also be made more open to foreign investors

Its projected Budget deficit for 2017 at 3 per cent of gross domestic product (GDP)  represents a year-on-year increase of 200 billion yuan.

With more foreign investors, it will boost growth for China in the long run

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BEIJING - China has set its growth target at a lower 6.5 per cent this year as it continues to deepen reforms, boost domestic demands and contain financial risks, Premier Li Keqiang said on Sunday (March 5).

The country aims for growth of "around 6.5 per cent, or higher if possible", Mr Li said at the opening of the annual session of the national parliament.

Last year, China set a target growth range of between 6.5 per cent and 7 per cent, and eventually achieved 6.7 per cent , its slowest in 26 years.

"The projected target for this year's growth is realistic and in keeping with economic principles, it will help steer and steady expectations and make structural adjustments," said Mr Li at the Great Hall of The People in Beijing as he delivered the government's work report.

Analysts say the target is within expectations and while there are signs that the economy is improving, it is more prudent to set a realistic goal.

More work needs to be done in tackling supply-side structural reforms and keeping financial risks in check.

China will continue to use a proactive fiscal policy to support growth. And this means more government spending, Its projected Budget deficit for 2017 at 3 per cent of gross domestic product (GDP) represents a year-on-year increase of 200 billion yuan.

Mr Li said a part of the Budget deficit will be used to further cut taxes and fees for businesses. The tax burden on private companies will be eased by around 350 billion yuan and business-related fees will be further cut by around 200 billion yuan.

Dr Yan Se, a senior China economist based in Beijing at the Standard Chartered Bank, told The Straits Times that policy measures to support sustainable growth is what stood out for him in this year's work report.

"The high level of openness in attracting foreign direct investment is to me, the most important area outlined in the report," said Dr Yan.

Local governments will now be able to adopt preferential policies to attract foreign investment. Service industries, manufacturing and mining will also be made more open to foreign investors.

Foreign-invested firms will be encouraged to be listed on China's stock exchanges and raise bonds in China. They will also allowed to participate in national science and technology projects.

The extent in opening up the market is "unprecedented" observed Dr Yan and this will help boost growth for the longer term, he added.

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China cuts growth target to 6.5% as it pushes through reforms: PM Li Keqiang

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BEIJING - China has set its growth target at a lower 6.5 per cent this year as it continues to deepen reforms, boost domestic demands and contain financial risks, Premier Li Keqiang said on Sunday (March 5).. Read more at straitstimes.com.

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Hayyuni

China is aiming to expand its economy by 6.5% in 2017

Hopes to achieve results with fiscal policy

Slow economic progress due to government debt

GDP grew by 6.5% in 2016, slowest in decades yet within target

Speculation that China will overstate growth to conceal truth of slowing economy

China targets to push forward with asset securitization and debt-to-equity swaps this year

China set a budget deficit target of 3% of GDP for this year

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"We watch (the official GDP announcement) as closely as we do in some sense out of a sense of obligation," Donald Straszheim, head of China Research at Evercore ISI, told CNBC in 2016.

Li also said in remarks prepared for delivery at the opening of the annual meeting of parliament that China will push forward with supply-side reforms this year and achieve new progress in structural adjustments in key areas.

China will also take steps to control risks and ensure safety in the financial sector, the premier said.

China should have higher levels of vigilance against risks from non-performing assets, debt defaults, shadow banking and internet finance, Li said.

It will steadily push forward with de-leveraging this year, mainly in the non-financial corporate sector, he added.

China also plans to push forward with asset securitization and debt-to-equity swaps this year.

China will continue to implement a city-based policy to reduce real estate inventories, mainly in the third and fourth-tier cities, Li said.

On Sunday, the country also set a budget deficit target of 3 percent of gross domestic product for 2017, the finance ministry said in its work plan, in line with the target set a year earlier.

China set a fiscal deficit target for the year of 2.38 trillion yuan ($345.16 billion). Last year, Beijing set a 2016 budget deficit target of 3 percent of GDP.

Notable targets from Li's prepared remarks on Sunday:

China targets 2017 GDP growth target of around 6.5 percent

China targets 2017 CPI target of around 3 percent

China targets 2017 budget deficit target at 3 percent of GDP

China targets 2017 M2 growth target of around 12 percent

Li also said in his prepared remarks that China will resolutely oppose and contain Taiwan
independence activities.

"We will never tolerate any activity, in any form or name, which attempts to separate Taiwan from the motherland," Li said.
-CNBC's Sophia Yan and Everett Rosenfeld contributed to this report.
Li additionally commented that the notion of Hong Kong independence would lead nowhere and China would strengthen its maritime and air defense capabilities.

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China cuts GDP growth target as it pushes through reforms, de-leveraging

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"We watch (the official GDP announcement) as closely as we do in some sense out of a sense of obligation," Donald Straszheim, head of China Research at Evercore ISI, told CNBC in 2016.

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Joey

Unemployment rate dropped drastically in the first quarter of year 2017

Graduates tend to look for jobs that are of their educational level

Some prefer to quit their job to stay at home to look after their children

Some grow discouraged after not being able to get a job after some time

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Janice

China is building up their debts.

China's economy recovery is still shaky, while the global economy situation is unstable.

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The PBOC raised the seven-day open market operations rate to 2.35 percent from 2.25 percent.

Banking sources said the overnight rate for the SLF loan was raised to 3.1 percent from 2.75 percent, with rates on other SLF loans increased more modestly. The SLF rate acts as a de facto ceiling for interbank lending, analysts said.

Even as it raised borrowing costs, China's central bank moved to reassure markets about liquidity by injecting funds through the 7-day, 14-day and 28-day repos on Friday.

The PBOC drained a net 250 billion yuan last week, before Chinese markets closed for the long Lunar New Year break.

"It's not a good kick off of the Lunar New Year. It is a clear sign that the central bank has switched to tighten its monetary policy," said a trader at a Chinese bank in Shanghai.

China's economy has seen a broad-based pickup in recent months, with fourth-quarter GDP beating expectations due largely to a strong housing market and higher government spending on infrastructure projects.

At the same time, however, capital flight from the tightly managed economy has been strong, fueled by expectations that the yuan currency will depreciate further after sliding to more than eight-year lows against the dollar.

The yuan fell nearly 7 percent last year, its biggest annual loss against the dollar since 1994, on worries about shaky growth early in the year and amid a surge in the greenback.

Bearish views on the yuan have persisted despite a series of tightening measures in recent months aimed at making it more difficult for Chinese individuals and corporations to send money abroad.

China's currency reserves fell by a tenth last year and, at $3.011 trillion, are close to falling below psychologically significant levels.

"The signal is very clear," said Zhou Hao, senior Asian emerging market economist at Commerzbank in Singapore, referring to the latest rate move.

Hao said this time the tightening was more targeted compared with China's previous tightening cycle that ended in 2013.

"Inflation at that time was rising very rapidly and at this time inflation is not really an issue. Secondly the yuan was under pressure to appreciate at that time."

"Right now it's totally different. If you have capital outflows, that's already tightening. And then you tighten further, which is a double-whammy."

Follow CNBC International on Twitter and Facebook.

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China raises short-term money market rates in fresh tightening signal

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The PBOC raised the seven-day open market operations rate to 2.35 percent from 2.25 percent. Banking sources said the overnight rate for the SLF loan was raised to 3.1 percent from 2.75 percent, with rates on other SLF loans increased more modestly. The SLF rate acts as a de facto ceiling for interbank lending, analysts said.

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Joey

China’s unemployment rate fell below 3.97%

Despite the ups and downs of China’s economy, unemployment rate still remains stable

Only industry that is increasingly hiring workers is Manufacturing.

Unemployment rate is high due to people age 45 or younger not working

Unemployment may be due to people who left their job to look for a better

Also, it may be because of increase of elderly retiring

People without job but are actively looking for job also contributes to unemployment rate

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China's official registered unemployment rate fell to a 14-year low of 3.97 percent in the first quarter, even as policy makers pledge to cut jobs in industries with excess capacity.

The Ministry of Human Resources and Social Securities released the data at a briefing Tuesday in Beijing. Another jobless rate, based on surveys in major cities to give it greater accuracy, fell below 5 percent in March, the National Bureau of Statistics said last week.

The labor market "continued a trend of stabilization and improvement," a ministry spokesman said at the briefing. Demand for workers in manufacturing increased faster than the labor demand growth across all industries, according to the spokesman.

While the jobless gauge is is known for barely changing with economic cycles, and statistics officials are working on a newer and more accurate survey-based version, the decline in unemployment coincides with economic growth posting the first back-to-back quarterly acceleration in two years.
Read More: China Workers Get Smaller Pay Gains Even Amid Ample Openings
China created 3.34 million jobs in the first quarter, on pace to exceed the government's 11 million target for this year.

Still, the employment situation this year remains difficult. There's a long-term shortage of skilled workers in some newer, upgraded sectors, while aged, low-skilled workers and fresh college graduates find it hard to nail jobs, according to the ministry.

The urban registered unemployment rate remained between 4 percent and 4.3 percent from the end of 2002 through the end of 2016, and it was unchanged at 4.1 percent from 2010 to 2013, even as growth slowed during the same period.
- With assistance by Jeff Kearns

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China's Jobless Rate Drops Below 4% for First Time Since 2002

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China's official registered unemployment rate fell to a 14-year low of 3.97 percent in the first quarter, even as policy makers pledge to cut jobs in industries with excess capacity. The Ministry of Human Resources and Social Securities released the data at a briefing Tuesday in Beijing.

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This is a summary of China's economy:

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China's economy: GDP growth, interest rates and inflation statistics

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20 charts that explain the Chinese economy

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The FT's one-stop overview of key economic data, including GDP, inflation, unemployment, the major business surveys, the public finances and house prices

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Si Min

China reflation cycle reached peak and is trending downwards

Domestic demand remains muted

China's economic expansion remains solid

First-quarter economic growth came in at a faster-than-expected 6.9 percent

PPI in April rose 6.4 percent from last year

Iron and steel processing prices fell 3.1 percent month-on-month in April.

Oil and natural gas prices also fell after rising the previous months.

China's annual inflation is to average 2.1 percent in 2017.

Beijing is targeting consumer inflation of 3 percent this year, since 2016.

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BEIJING China's April producer price inflation cooled more than expected in a sign manufacturing activity may be losing momentum along with other sectors of the economy as domestic demand remains muted and the government cracks down on financial risks.

Prices for raw materials fell in April from the previous month, pressured by fears that domestic demand will not be strong enough to absorb surging factory output that rose the most in more than two years in March.

A renaissance in China's steel industry has been a major driver of the world's second-largest economy in recent quarters, helping generate the strongest profit growth in years and adding to a reflationary pulse across the global manufacturing sector.

But China's reflation cycle in producer prices has probably peaked, and will trend down further, which could drag on China's economic growth in the second half of the year, said Betty Wang, senior China economist for ANZ in Hong Kong.

"The recovery momentum in the economy that emerged in the second half of last year was mainly driven by producer price inflation rather than any changes from a fundamental perspective," Wang said.

The soft April inflation data, combined with slightly slower growth in manufacturing activity, reinforces analysts' views that China's economic expansion remains solid but is starting to moderate after a surprisingly strong start to the year.

First-quarter economic growth came in at a faster-than-expected 6.9 percent, which could give the economy enough of a tailwind to hit Beijing's full-year target even if growth starts to fade in coming quarters as many analysts expect.

With growth comfortably above this year's target of around 6.5 percent, Chinese policymakers have shifted focus to reining in financial risks, which ANZ's Wang said will not change based on trends in producer and consumer prices.

"Deleveraging remains the policy focus, regardless of the PPI or CPI trend. We don't think PPI or CPI will have any significant impact on the current policy direction," said Wang.

The producer price index (PPI) in April rose 6.4 percent from a year earlier, the National Bureau of Statistics said on Wednesday - cooling for the second month in a row. It was slower than economists' expectations for a 6.9 percent rise and easing further from the previous month's gain of 7.6 percent.

Analysts said the rally in producer prices may have peaked as a torrid rally in China's commodities markets showed signs of correcting. Iron ore and steel hit multi-month lows on China's future markets in April amid concern over rising inventories.

Capital Economics said in a report that producer prices were set to fall again in May given that the rout in industrial commodity prices had deepened.

"Further ahead, producer price inflation should continue to wane as policy tightening weighs on economic activity...hopes for a sustained reflation in China are fading."

On a month-on-month basis, producer prices fell 0.4 percent in April, the first drop since June, led by declines in iron and steel smelting and processing.

Iron and steel processing prices fell 3.1 percent month-on-month in April, compared with a 2.3 percent rise in March, while oil and natural gas prices also fell after rising the previous months.

In March, China's PPI cooled for the first time in seven months as commodities prices tumbled, pressured by fears that Chinese steel production is outweighing demand and threatening a glut of the metal later this year.

Factory gate prices had only turned positive on a year-on-year basis last September, after falling for nearly five years, leaving many industrial firms saddled with idle capacity and less cash flow to service their debts.

The consumer price index (CPI) in April rose 1.2 percent from a year earlier, the statistics bureau said, up from a 0.9 percent rise in March and slightly above analysts' forecasts.

Food prices, the biggest component of the consumer price index (CPI), fell 3.5 percent.

Core inflation inched up to 2.1 percent, with costs for health care rising 5.7 percent.

Analysts polled by Reuters had predicted April consumer price inflation would edge up to 1.1 percent but remain well within the central bank's comfort zone, giving it room to continue with a gradual pace of monetary policy tightening without hurting economic growth.

China's annual inflation is to average 2.1 percent in 2017 and 2.3 percent in 2018, according to a Reuters poll of over 75 economists.

Beijing is targeting consumer inflation of 3 percent this year, unchanged from 2016.

Chinese President Xi Jinping called last month for increased efforts to ward off systemic risks to help maintain financial security, the official Xinhua news agency reported.

Graphic: China economy dashboard - tmsnrt.rs/2lQ48De

(Editing by Jacqueline Wong)

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China's factory prices slow further as manufacturing, commodities cool

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BEIJING China's April producer price inflation cooled more than expected in a sign manufacturing activity may be losing momentum along with other sectors of the economy as domestic demand remains muted and the government cracks down on financial risks.

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Christy

Consumer inflation has rapidly rise to 2.5% in January, the highest since May 2014.

Food prices was the highest component, with the price increase  of pork by 7.1%.

-Fuel costs has rise up by 16.5% on-year and is the biggest increase in the CPI components.

From Dec 2016 to Jan 2017 inflation had rise by 0.8%.

Some banks in China has started discount for first-timers buying houses.

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BEIJING China's producer price inflation picked up more than expected in January to near six-year highs as prices of steel and other raw materials extended a torrid rally, adding to views that global manufacturing activity is building momentum.

China consumer inflation also rose more than expected, nearing a three-year high as fuel and food prices jumped, data showed on Tuesday.

Much of the pick up in consumer prices was likely due to higher food and travel costs heading into the long Lunar New Year holiday, the National Bureau of Statistics (NBS) said.

But mounting price pressures in China and many other countries have sparked talk of tighter monetary policy this year, after years of super-loose settings aimed at reviving economic growth.

China's central bank raised short-term interest rates in recent weeks as it looks to contain risks from an explosive growth in debt, while India's central bank last week unexpectedly signaled an end to its longest easing cycle since the global financial crisis, citing inflation risks.

Some analysts, however, believe the ramp up in price pressures in China may be short-lived, noting that a jump in January food prices was likely seasonal and that producer price gains slowed by half on a month-on-month basis.

"We don't expect such high rates of inflation to last," Capital Economics China economist Julian Evans-Pritchard said in a note.

"Tighter monetary policy, slowing income growth and cooling property prices should keep broader price pressure contained over the medium-term," he added, noting that weak prices early last year may have exaggerated the strength of a reflationary trend seen in recent months.

Consumer inflation quickened to 2.5 percent in January from a year earlier, the highest since May 2014.

But it is still well within the government's comfort zone of 3 percent, and is showing few signs yet that the jump in producer prices is filtering through to the broader economy, analysts say.

Analysts polled by Reuters had predicted the consumer price index (CPI) would rise 2.4 percent, after a 2.1 percent gain in December.

Food prices, the biggest component of CPI, rose 2.7 percent in January, led by a 7.1 percent increase in the price of pork.

Fuel costs surged 16.5 percent on-year, the biggest increase among CPI components, likely due to a low comparison in the year-ago period when fuel prices fell.

Capital Economics expects consumer prices to rise only 2.0 percent this year.

Producer price inflation accelerated to 6.9 percent -- the fastest since August 2011 -- from December's rise of 5.5 percent.

Gains in the producer price index (PPI) were driven by a 31.0 percent increase in mining costs as coal prices rise, the biggest jump in that category since early 2010.

The market had expected producer prices to rise 6.3 percent on an annual basis.

But on a monthly basis, they only rose 0.8 percent, down from December's 1.6 percent gain.

China's massive imports of coal, crude oil, iron ore and industrial materials have helped fuel a sharp rebound in global resources prices in recent months, boosting profits for producers and processors.

Iron ore futures in China rose for a sixth session in a row on Tuesday, hitting their highest in more than three years, while London copper futures have climbed to around 20-month highs.

Price gains in China have been further amplified by government efforts to reduce industrial overcapacity.

Investors are cashing in on the global reflationary trade. Shares of Jiangxi Copper Co Ltd, China's biggest integrated copper producer, have surged over 60 percent in the past year in Shanghai and 85 percent in Hong Kong.

But heady increases in China's commodity futures market, especially for iron ore, metal reinforcing bars and coking coal used in steel production, have added to policymakers' worries about speculative price bubbles.

Worries about speculation and debt risks led the central bank to move to a tightening bias in recent months, not inflation, analysts say.

"Inflation is not the main driver of monetary policy at the moment...I do think they are going to tighten more this year, but the main driver is credit risk and concerns of leverage and what's going on in the property market," said Capital Economics' Evans-Pritchard.

Banks in some big Chinese cities have started to reduce discounts on mortgage rates for first-time home buyers, newspapers have reported, joining recent steps to curb financial risks stemming from years of loose credit conditions.

(Reporting by Beijing Monitoring Desk and Elias Glenn; Editing by Kim Coghill)

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monetary / fiscal policy / policy makers

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Inflation picks up to multi-year highs in China as central bank eyes tighter policy

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BEIJING China's producer price inflation picked up more than expected in January to near six-year highs as prices of steel and other raw materials extended a torrid rally, adding to views that global manufacturing activity is building momentum. China consumer inflation also rose more than expected, nearing a three-year high as fuel and food prices jumped, data showed on Tuesday.

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Christy

Producer price inflation has went up to 6.9%.

Food inflation increase from 2.4% to 2.7%

Non-food inflation increase from 2.0% to 2.5%.

Non-food inflation has been rising the fastest pace over the years.

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Reuters/Erik De Castro

Chinese inflationary pressures went up a cog in January, led by another enormous surge in producer price inflation (PPI).

According to China's National Bureau of Statistics (NBS), PPI jumped by 6.9% from a year earlier, the largest annual increase reported since August 2011.

It was well above the 6.3% increase expected, and followed a 5.5% lift in the year to December.

For the month, producer prices increased by 0.8%.

A hot reading, and largely reflective of higher input costs as a result of booming commodity prices.

The NBS said costs for mining extraction surged by 31% from a year earlier, while those for raw materials increased by 12.9%. They previously rose by 21.1% and 9.8% respectively in the 12 months to December.

Business Insider Australia

And with factory gate prices on the rise, there's signs that those upstream price pressures are now being passed on to consumers.

The NBS said consumer price inflation rose by 2.5% from a year earlier, a figure that was higher than the 2.1% increase of December and market expectations for an acceleration to 2.4%.

It was the fastest increase since May 2014, with prices for both food and non-food items growing at a faster pace than December

Food inflation rose by 2.7% over the year, up from 2.4% in the previous month, while non-food prices jumped by 2.5%, again above the 2.0% level reported previously.

It's the gain the latter that's of most interest, indicating that inflationary pressures are now clearly accelerating throughout the broader Chinese economy, an outcome one would expect given easy monetary conditions and a clear pickup in economic activity seen in 2016.

Non-food inflation is now rising at the fastest pace in years.

In January alone, food prices increased by 2.3%, led by a 3.4% jump in pork prices, a staple of the Chinese diet. The increase reflects the timing of the Lunar New Holiday which began in the final week of January.

Non-food inflation increased by a smaller 0.7% over the same period, building upon the 0.2% lift seen in December. It was the largest monthly increase in over a year.

Combined, CPI rose by 1% over the month.

Despite the acceleration in both producer and consumer price inflation in January, Larry Hu, head of China economics at Macquarie Securities in Hong Kong, doesn't think that it will be enough to see the People's Bank of China (PBoC) tighten monetary policy settings in the near-term.

"There will be a mild reflation throughout this year," he said in an interview with Bloomberg. "Although the PPI may keep rising in the first quarter, this is a relatively healthy inflation, and it probably won't affect the policy stance of the PBoC, which now is clearly focused on cutting financial leverage."

Following the release of the inflation report, Chinese stocks have fallen into the red while commodities futures have trimmed their earlier session gains.

The benchmark Shanghai Composite stock index currently trades at 3,210.9, down 0.18%.

Read the original article on Business Insider Australia. Copyright 2017. Follow Business Insider Australia on Twitter.

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SEE ALSO: A high-profile hedge fund sent a letter explaining all the reasons it lost money last year, and why it is going to do better this time

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Chinese inflationary pressures went up a cog in January, led by another enormous surge in producer price inflation (PPI). According to China's National Bureau of Statistics (NBS), PPI jumped by 6.9% from a year earlier, the largest annual increase reported since August 2011.

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Hayyuni

Growth of 6.9%

Fastest economic growth since 2015

However, this might be the best it can get for the year.

China's conventional ways of sustaining the economy is holding back its potential in growth.

Disposable income growth increased by 7% and retail sales by 10.9% which are showing signs of economic recovery

China is trying to focus on getting a stable economy before having reformations

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Kevin C. Cox./Getty

(Reuters) - China's economy expanded faster than expected in the first quarter as higher government infrastructure spending and a gravity-defying property boom helped boost industrial output by the most in over two years.

Growth of 6.9 percent was the fastest in six quarters, with forecast-beating March investment, retail sales and exports all suggesting the economy may carry solid momentum into spring.

But most analysts say the first quarter may be as good as it gets for China this year, and worry Beijing is still relying too heavily on stimulus and "old economy" growth drivers, primarily the steel industry and a property market that is showing signs of overheating.

"The Chinese government has a tendency to rely on infrastructure development to sustain growth in the long term," economists at ANZ said in a note.

"The question we need to ask is whether this investment-led model is sustainable as the authorities have trouble taming credit. We need to watch closely whether China's top leadership will send a stronger signal to tighten monetary policy shortly."

Even as top officials vowed to crack down on debt risks, China's total social financing, a broad measure of credit and liquidity in the economy, reached a record 6.93 trillion yuan ($1 trillion) in the first quarter -- roughly equivalent to the size of Mexico's economy.

At the same time, spending by the central and local governments rose 21 percent from a year earlier.

That helped goose the pace of growth in the first quarter well above the government's 2017 target of around 6.5 percent, and pipped economists' forecasts of 6.8 percent year-on-year.

Such a strong bolt from the gate could see Beijing once again meet its annual growth target, even if activity starts to fade later in the year, as many analysts widely expect.

"Main indicators were better than expected...which laid a good foundation for achieving the full-year growth goals," statistics spokesman Mao Shengyong said at a news conference.

SAME OLD GROWTH DRIVERS?

Once again, China's policymakers leaned on infrastructure and real estate investment to drive expansion in the first quarter. Growth in both areas has accelerated from last year and helped offset slightly weaker growth in the services sector.

"Faster growth in industrial output is the primary factor in the first quarter surprise, and due mostly to higher value-added growth related to supply-side consolidation in heavy industry," said Brian Jackson, China economist at IHS Global Insight.

Real estate investment also remained robust in the first quarter, expanding by 9.1 percent on-year, and the pace of new construction quickened despite intensifying government measures to cool soaring prices.

Most analysts agree the heated property market poses the single biggest risk to China's economic growth, but predict the cumulative weight of property curbs will eventually temper activity, not produce an outright crash.

"Sales have started falling, which means tightening measures are starting to take effect," said Shen Jianguang, an analyst at Mizuho Securities in Hong Kong, noting that will start to drag on both the services and construction sectors.

More than two dozen cities announced new or additional property cooling measures in March and early April, after curbs late last year appeared to have little lasting effect.

Buoyed by a near 12 percent increase in housing starts, China produced a record amount of steel in March, Reuters data showed, though analysts say warning signs are flashing.

Rising inventory levels and recent falls in steel prices suggest output has been growing faster than China's actual demand, raising worries of a glut later in the year, which could heighten trade tensions with the U.S. and its other major trading partners.

INCOME GROWTH PICKS UP

There were also positive signs on the consumer front in Monday's data dump.

After slowing for five quarters, disposable income growth picked up to 7.0 percent in the first quarter, the fastest since the end of 2015.

March retail sales rebounded 10.9 percent on-year as consumers shelled out more for home appliances, furniture and decorations for new homes.

Auto sales also showed signs of recovering after weakening in the first two months of the year after the government reduced subsidies on small cars.

Analysts are closely watching for signs that consumption is accounting for a greater share of China's economy, which would

not only make growth more resilient and broader based but also reduce the need for more debt-fueled stimulus and reliance on "smokestack" industries.

FOCUS ON STABILITY, THEN REFORMS

Though policymakers have pledged repeatedly to push reforms to head off financial risks and asset bubbles, the government is seeking to keep the economy on an even keel ahead of a major leadership transition in later this year.

China's central bank has gingerly shifted to a tightening policy bias in recent months, and is using more targeted measures to contain risks in the financial system, after years of ultra-loose settings.

It has bumped up interest rates on money market instruments and special short- and medium-term loans several times already this year and further modest increases are expected, especially if U.S. rates continue to rise.

"I think China should be directing the economy to slow down its growth in the long term...but on the contrary, growth is accelerating," said Hidenobu Tokuda, senior economist at Mizuho Research Institute in Tokyo.

"This is good for now but it makes it difficult to see how China's economic slowdown will land in the future. Uncertainties remain high."

(Reporting by Kevin Yao and Yawen Chen; Writing by Elias Glenn; Editing by Kim Coghill)

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China's economy grows at its fastest pace since 2015

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(Reuters) - China's economy expanded faster than expected in the first quarter as higher government infrastructure spending and a gravity-defying property boom helped boost industrial output by the most in over two years. Growth of 6.9 percent was the fastest in six quarters, with forecast-beating March investment, retail sales and exports all suggesting the economy may carry solid momentum into spring.