The Chinese economy is expected to continue growing.

The yuan has slightly weakened compared to the dollar today, but most investors are not concerned about the better-than-expected economic expansion data in China. Basic indicators show that the post-COVID recovery is still not very stable.

China's economy expanded by 4.5% in the first quarter, higher than expected, due to the lifting of strict COVID-19 control measures, which is seen as a boost to business and consumer spending. There has been increased excitement within the country.

In addition to the economic announcements, retail sales increased by more than 10%, almost reaching a two-year high. This is seen as a hopeful sign that the country's economy will continue to grow.

Ken Cheung, chief Asia FX strategist at Mizuho Bank, said, "While the overall GDP numbers look good, the March data indicates an inconsistent recovery. Consumer spending is the main driver of the economy's recovery, but industrial production has been disappointing, as seen in the strong export figures."

"Consumer spending has been proven to be the main driver of the economy's recovery, but industrial production has been disappointing, as seen in the strong export figures," said Ken Cheung, chief Asia FX strategist at Mizuho Bank.

The dollar has strengthened slightly, with data showing an increase in manufacturing activity in the state of New York for the first time in 5 months, raising expectations that the US Federal Reserve may raise interest rates again at the next meeting in May.

However, the yuan has not responded to the GDP data, and this perspective is supported by some investors who believe that Beijing can loosen monetary policy further to help the economy recover. This is in contrast to the US Federal Reserve, which is expected to raise interest rates again in May.

Joe Hu, an economist at Guotai Junan International, said, "I think the data is good overall, including headline numbers, consumption, and employment data. I still think monetary policy will continue to support, and in general, the chances of lowering interest rates are still relatively high."

At the time of 14:04 GMT+7, the US Dollar Index (DXY) has slightly strengthened to 101.86, indicating that the dollar is still able to appreciate slightly after the interest rate hike next month.

Technical analysis data (5H)