China's Q1 GDP grows more than expected

Some more monetary tightening move could be in the offing in China and the pressure to let the yuan float a little more freely may also increase after first-quarter gross domestic product (GDP) grew at a faster than anticipated pace. GDP in the January to March period expanded by 11.9% from 10.7% in the fourth quarter of 2009, the National Bureau of Statistics (NBS) said. Economists had forecast growth of 11.5%. It was the fastest growth rate in the first quarter since 2007, when the Chinese economy grew by 13%. Non-deliverable yuan forwards climbed 0.2% to 6.6140 as of 10:08 a.m. in Hong Kong, suggesting that the currency may appreciate 3.2% in the next 12 months. The Shanghai Composite Index swung from losses to a gain following the release of the GDP data. Industrial production rose 18.1% in March and retail sales climbed 18%, the data showed. Urban fixed-asset investment increased 26.4% in the first quarter from a year earlier. Consumer prices in China rose at a less-than-estimated pace of 2.4% in March from a year earlier, government data showed. CPI rose by 2.7% in February. Economists had forecast a gain of 2.6%. The producer price index (PPI) was up 5.9% after climbing 5.4% in February.