(Yicai) April 8 -- China’s economy in the first three months is likely to expand by 5 percent from the year before, and is on target to meet this year’s growth goal of around 5 percent, according to chief economists polled by Yicai who are of the opinion that the country’s economic recovery is gaining steam.

The Yicai Chief Economists Confidence Index for April was 50.86, the second straight month of expansion and staying above the benchmark of 50, indicating growing confidence, according to the results of the Shanghai-based media group’s latest poll.

The purchasing managers’ index for manufacturing is back in positive territory, sending a positive signal, Cai Wei, the chief strategy officer of KPMG Advisory China, said last month.

There has been a significant rebound in the new orders and new export orders subindexes, driving expectations that more demand in sectors such as the electronics and automotive sectors will push up exports, Cai said. More people are willing to travel, spending power is increasing, investment is bouncing back and the manufacturing sector, which is supported by strong policies, is proving to be resilient.

The consumer price index, a gauge of inflation, is likely to climb 0.44 percent in March from a year earlier, a slowdown from February’s 0.7 percent gain, according to the chief economists. And the producer price index could sink 2.62 percent. This would be a narrowing from February’s minus 2.7 percent.

The issues of insufficient demand and overcapacity in some industries have not been effectively addressed and investment in real estate is slowing, said Zhang Jun, chief economist at China Galaxy Securities. Therefore the PPI is unlikely to return to positive territory until the fourth quarter.

However, the CPI is recovering faster than expected. The CPI forecast for the year has been raised to 0.8 percent and it should turn positive in the first quarter, Zhang said.

In March, the retail sales of consumer goods is expected to climb 4.3 percent year on year, but this is slower than the 5.5 percent clip in the first two months, the poll said.

The growth rate of retail sales of passenger vehicles, one of the largest categories of optional consumption, slowed to 11 percent in the first 24 days of March, said Chen Xing, chief macro analyst at Caitong Securities. Consumers are adopting a wait-and-see approach as carmakers continue to slash prices.

The growth rate of consumer goods consumption may experience a decline due to the high base line last year, Chen said.

Editor: Kim Taylor