China's industrial output grew faster than expected at the start of 2018, suggesting the economy has sustained solid momentum even as U.S. President Donald Trump readies hefty tariffs against one its most strategic growth drivers.
Tariffs on tech exports could potentially hit the fastest growing segment of China's industrial sector, as Trump seeks to impose tariffs on up to $60 billion of Chinese imports in the very near future.
Industrial output in January-February rose 7.2 per cent from the same period a year earlier, the National Bureau of Statistics said, surpassing analysts' estimates for a rise of 6.1 per cent and picking up sharply from 6.2 per cent in December.
Analysts had expected a slight stumble in output due to a crackdown on heavily polluting industries, but the data showed China's steel output rose to its highest in months as mills prepared for a seasonal pick-up in construction in spring.
Reflecting China's growing focus on the production of higher-value goods, output of computers, telecommunications equipment and other electronics rose 12.1 per cent on year, extending a long period of double-digit growth.
However, data from China early in the year is typically treated with caution due to distortions caused by the timing of the week-long Lunar New Year celebrations, which fell in late January in 2017 but in mid-February this year.
Many economists expect China's economic momentum to slow this year, weighed down by a cooling property market and the government's clampdown on riskier lending practices, which is pushing up corporate borrowing costs.
But a clutch of readings so far suggest China's growth is still resilient, keeping a synchronised global recovery on track.
China's fixed-asset investment growth also unexpectedly picked up to 7.9 per cent in January-February against a forecast for 7.0 per cent.
Private sector fixed-asset investment rose 8.1 per cent, compared with an increase of 6.0 per cent in 2017.