Event:
National Bureau of Statistics released China’s urban fixed assets investment of January-April 2009 on May 12, 2009: During the period under view, urban fixed assets investment was Rmb3078.2bn, up by 30.5% yoy; of which, state-owned or state holding projects completed investment of Rmb1605.5bn (+39.3% yoy) and real estate development realized investment of Rmb729bn (+4.9% yoy).
Our Analysis and Estimation
China’s investment saw rapid growth in April 2009, which was mainly due to the Rmb4tn investment plan.
Growing speed of real estate investment sustained sluggish.
Rmb4tn investment plan was the main impetus for rapidly growing investment.
Conclusion:
Rapidly growing investment in 2009 is resulted from the proactive fiscal policy and quantitative easing monetary policy. With the completion of de-inventory, industrial production will be accordingly conducted by the high growth of investment, and economic acceleration will gradually rallies in the coming three quarters of 2009.