Not out of the woods

On the surface, the Chinese GDP numbers for Q1 climbed 5.3% in the period, accelerating slightly from the previous quarter and beating estimates. However the bounce came in the first two months of the year. In March, growth in retail sales slumped and industrial output decelerated. This confirms our belief that the Chinese economy is not out of the woods yet. For the time being, we therefore continue to stay away from Chinese equities in our global asset allocation as we find enough investment opportunities in the US and Europe to build diversified global portfolios.