China's economy grows faster than expected in the first quarter

China's economy got off to a stronger-than-expected start to the year, even as the crisis in the real estate sector worsens.

According to official data, GDP grew by 5.3% in the first three months of 2024, compared to the previous year.

This exceeds expectations that the world's second-largest economy may see growth slow to 4.6% in the first quarter.

Data from the National Bureau of Statistics (NBS) also showed that first-quarter retail sales growth, a key measure of consumer confidence in China, fell to 3.1%.

“You can't manufacture growth forever, so we really need to see households coming to the party if China is to meet its growth target of around 5%,” Moody's Analytics' Harry Murphy-Crews told the BBC.

In the same period, real estate investment fell by 9.5%, highlighting the challenges faced by real estate companies in China.

These numbers came as China continues to struggle with the ongoing real estate market crisis. According to the International Monetary Fund, the sector represents about 20% of the economy.

The latest data also showed new home prices falling at the fastest pace in more than eight years in March.

The real estate industry's crisis was highlighted in January when a Hong Kong court ordered real estate giant Evergrande into liquidation.

Rival developers Country Garden and Shimao have also been hit with liquidation petitions in the city.

Last week, credit rating agency Fitch lowered its outlook for China, citing growing risks to the country's public finances as it faces economic challenges.

For decades, the Chinese economy has expanded at a stellar rate, with official figures indicating that China's GDP is growing at a rate of close to 10% annually.