(Yicai) March 10 -- A gauge of sentiment on China’s economy compiled by Yicai remained above the boom-bust line for the eighth consecutive month in March, with strong signals from the nation’s two annual policy-setting meetings pointing to more proactive economic policy.

The Yicai Chief Economists Confidence Index came in at 50.5 for this month, compared with 50.2 in February and 50.3 in January, according to a survey of 13 leading China-based chief economists. A reading above 50 indicates optimism.

Signals from the ongoing Lianghui, or Two Sessions in English, underpin the view that the government is adopting a more proactive economic policy stance.

The economic growth target of 4.5 percent to 5 percent for this year reflects a cautious approach amid external uncertainty and rapid domestic structural change, while preserving space for policy adjustments and preventing risks, according to Cheng Shi, chief economist at Industrial and Commercial Bank of China International.

Measures announced at the Two Sessions, including CNY1.3 trillion (USD188 billion) in ultra-long special treasury bonds, CNY800 billion (USD115.7 billion) in new policy-based financial tools, and CNY100 billion in special funds to stimulate domestic demand, could boost investment and consumption in the near term, said Cai Wei, chief economist at Klynveld Peat Marwick Goerdeler China Advisory.

Over the medium to long term, initiatives such as the Artificial Intelligence Plus action plan, the push for new industrialization, and strategic planning for future industries will help optimize and upgrade China’s economic structure, Cai added.

The global economy will continue to grow at a slow pace this year, with trade protectionism and geopolitical risks remaining the main uncertainties, according to Wang Han, chief economist at Industrial Securities.

China’s economic work will focus on reviving domestic demand and and improving the economic structure, he noted, adding that the growth target will be around 5 percent this year, with growth relying more on improving consumption and stabilizing investment.

Economic Indicators

The consumer price index rose 1.3 percent in February from a year earlier, faster than the average 1 percent predicted by the economists, mainly because of the Chinese New Year holiday. Meanwhile, the producer price index fell 0.9 percent, versus a mean forecast for 1.2 percent.

Retail sales of consumer goods likely rose 2.4 percent in January and February from a year ago, versus a 0.9 percent gain in December, per the economists.

Consumption promotion activities implemented since the start of the year, combined with government subsidies for trade-in programs are helping release pent-up demand for product upgrades, supporting growth in the consumer market, said Wen Bin, chief economist at China Minsheng Bank.

The economists’ average forecast for industrial production for the first two months of the year was 5.3 percent, slightly higher than December’s 5.2 percent increase. Fixed asset investment growth is expected to have fallen 3.2 percent, compared with a decline of 3.8 percent in 2025.

Fixed asset investment typically shows strength in the first half, so it is expected to rebound early this year, said Lu Zhengwei, chief economist at Industrial Bank.

China’s trade surplus was likely USD157.7 billion in the two months ended Feb. 28, according to the economists. Their average forecasts for growth in imports and exports were 5.1 percent and 5.4 percent, respectively, versus 4.4 percent and 5.2 percent in December.

High-frequency data from ports indicate that exports may continue to rise at a relatively fast pace this year, Lu noted, adding that the year-on-year growth of cargo and container throughput at Chinese ports was 9.3 percent and 13 percent, respectively, as of Feb. 22.

The central parity rate of the Chinese yuan against the US dollar will be 6.9 at the end of this month and 6.8 at the end of this year, the economists predicted. The yuan has been appreciating steadily against the dollar, creating the basis and conditions for a moderate appreciation going forward, said Lian Ping, chief economist at the Guangkai Chief Industry Research Institute.

Editor: Futura Costaglione