Chinese fixed asset investment rose 4.5 percent year-to-date in March, up from 4.2 percent for January and February combined and above the consensus forecast of 4.0 percent. Separate year-over-year data for January and February are not published because of the impact of differences in the timing of lunar new year holidays from year to year. In month-over-month terms, fixed asset investment rose 0.14 percent in March after advancing 0.88 percent in January/February.

Officials characterised GDP and monthly data published today as showing that"the national economy continued the good momentum of rebound" and indicated that they see the current policy stance as appropriate. Officials also warned, however, that"the external environment is becoming more complex, severe and uncertain, and the foundation for stable and sound economic growth is not solid yet".

Quarterly GDP data published today were stronger than expected but monthly data were generally weaker than the consensus forecasts. China's Relative Performance Index fell from plus 7 to minus 34 and the RPI-P fell from plus 30 to minus 27, indicating that recent Chinese data in sum are now coming in below consensus forecasts.

Fixed asset investment for year-to-date March is expected to rise 4.0 percent. This would compare with 4.2 percent growth in the last report which covered the combined months of January and February.

Investment in fixed assets refers to the investment in construction and purchase of fixed assets by private and state-controlled domestic enterprises and households (excluding rural households) involving a total planned investment of CNY5 million yuan or more. Separate data for private investment and state-controlled investment are published as well as more detailed data on an industry basis.

Investment in fixed assets is an important part of gross domestic product and also provides the additional productive capacity to an economy that is required to drive future growth. Strong growth in this category of spending indicates that enterprises are confident about future prospects and is generally associated with rising employment and incomes.

Investment in fixed assets therefore provides information about near-term and future economic growth. Investors need to closely track the economic growth because it usually dictates how investments will perform. Investors in the stock market like to see healthy economic growth because robust business activity translates to higher corporate profits. Bond investors are more highly sensitive to inflation and robust economic activity could potentially pave the road to inflation. By tracking economic data such as GDP, investors will know what the economic backdrop is for these markets and their portfolios.