China's economic growth slowed unexpectedly in the first three months of the year, fueling concern about the strength of its shaky recovery.
The world's second-largest economy grew by 7.7% compared to the same time last year, down from the previous quarter's 7.9%, the government said today.
That fell short of many private sector forecasts that growth would accelerate slightly to 8%.
Analysts have warned that China's recovery from its deepest slump since the 2008 global crisis is weak and is being supported by bank lending and government-led investment, while growth in consumer spending is subdued.
The unexpected growth setback could add to challenges for Communist Party leaders who took power over the past six months. They are trying to avoid job losses while they pursue more self-sustaining growth based on domestic consumption instead of exports and investment.
Last year's slowdown was largely due to Beijing's efforts to cool inflation and steer double-digit growth to a more sustainable level following a quick, stimulus-fueled rebound from the global crisis.
Beijing responded with further stimulus efforts including looser credit but analysts say Chinese leaders are unlikely to repeat that strategy, which led to a sharp rise in debt.
The latest quarterly growth was above Beijing's official target of 7.5% for the year. That is well above forecasts in the low single digits for Western economies and Japan but far from China's blistering growth of the past decade.
A slowdown in Chinese growth and demand for goods ranging from iron ore to factory technology and consumer goods could send out ripples in the global economy. Recent economic data in China has given mixed signals, raising questions about whether a full-fledged recovery was gaining traction.
Inflation fell in March, indicating consumer demand might not be as strong as Beijing hoped. Import growth accelerated, suggesting companies and consumers were buying more, but some analysts said those figures might be distorted and unreliable.
Also in March, growth in factory output weakened to 8.9%, down one percentage point from the first two months of the year, according to the National Bureau of Statistics. That was the lowest growth since August 2012, when fears of an abrupt "hard landing" of plunging growth were strong. Beijing responded by boosting lending and government spending.
