Chinese firms recovering confidence in Q1

Chinese companies were struggling to recover their confidence in the first quarter of this year amid a slowdown in economic growth, according to an index released by the National Bureau of Statistics (NBS) on Monday.

China's business climate index, a major gauge of the country's macroeconomic outlook, advanced to 125.6 points Jan.-March, up from 124.4 points in the fourth quarter of 2012.

The Q1 reading marked a recovery for two quarters in a row after the index dipped in Q2 and Q3 last year.

Compared with the same period of last year, the Q1 index ticked 1.7 points lower, while the entrepreneurial confidence index, which stood at 122.4 points, was 3.2 points lower than the climate index, indicating Chinese entrepreneurs were in a mild recovery, said the NBS.

The sub-index which reflects companies' anticipation of current operations declined 5.1 points from Q4 to 119 points in Q1, while the sub-reading measuring enterprises' future operations rebounded 5.3 points to 129.9 points.

The index ranges from zero to 200. A reading of 100 demarcates expansion from contraction.

The index surveys around 21,000 industrial enterprises.

Analyzed by breakdown, the information transaction, software and IT service sector reported the most optimistic business climate score of 140.6 points, though 3.8 points lower than the fourth quarter.

The oil processing sector was the only industry that reported a negative business climate rating below 100 points.

Industrial firms in China's central areas saw stronger momentum in Q1, with a sub-index of 127.6 points, compared with 125.5 points for the eastern regions and 122.6 points in western regions.

Also on Monday, NBS figures showed that China's economic growth eased to 7.7 percent year on year in the first quarter, down from 7.9 percent in the fourth quarter of 2012.

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