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TEXT OF STORY
Steve Chiotakis: Over in China, numbers out today show the country’s GDP slowed in the first quarter to its weakest growth since 1992. But a closer look reveals the worst may be over. From Shanghai, here’s Marketplace’s Scott Tong.
Scott Tong: Six-point-one percent growth is slower than previous quarters in China. But most economists consider this headline number a lagging indicator of the past. And going forward, a host of other numbers out today suggest economic sprouting. New infrastructure projects, like railroads, are way up. So is lending, consumer spending and factory output.
Glenn Mcguire at Societe Generale thinks China has bottomed out:
Glenn Mcguire: We’re starting to move up the second side of the V. It’s clearly rebounding on a massive liquidity surge that’s been engineered by Beijing.
The government has told state banks to lend, now. And state shovels to be ready.
Mcguire: No other economy has the ability to be able to mobilize resources as quickly as China can, being still essentially a command economy.
Still, a V-shape recovery can be the first half of a W. A second dip could come when the stimulus wears off next year. Especially if the rest of the world stays weak, and Western shoppers remain a little too thrifty.
In Shanghai, I’m Scott Tong for Marketplace.
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