Calls for More China Stimulus Grow Louder as Economy Contracts

The first contraction in decades for China’s economy has increased expectations that policy makers will step up stimulus, market watchers say.

Gross domestic product shrank 6.8% in the first quarter from a year ago, as the coronavirus outbreak shut down large parts of the world’s second-largest economy and dimmed the global outlook. However, other data showed factory output falling 1.1% in March, an improvement from the first two months of the year. Market reaction was mild as investors digested the numbers.