China: nothing to cheer about stable Q1 GDP

From nordea.com

As expected the Chinese economy grew by 6.7% y/y in Q1. While the market is relieved about a stabilisation in China, there is no reason to cheer. The stabilisation is largely caused by the massive monetary easing, which given the already large debt bubble, is not sustainable. We expect the government stimulus to successfully prevent an economic crisis this year but the explosive credit expansion adds to the medium-term risk of a burst of the large debt bubble. As another sign that points towards a stabilised economy, the Chinese GDP growth was 6.7% y/y in Q1, in line with our and the consensus estimates. This was a ... (full story)