People gather around cars' trunks displaying items for sale in Wuhan, in central China's Hubei province. China's economy grew 6.1 percent in the first quarter from a year earlier amid massive stimulus spending, data showed Thursday, April 16, 2009, and the government said conditions were better than expected.

China's economy grew at its slowest pace in at least a decade in the first quarter as the global financial crisis battered trade, but the government said the performance was better than expected amid huge stimulus spending.

The world's third-largest economy grew 6.1 percent from a year earlier, down from the previous quarter's 6.8 percent expansion, the government reported Thursday.

"The overall national economy showed positive changes, with better performance than expected," Li Xiaochao, a spokesman for the National Bureau of Statistics, said at a news conference. But Li warned that the economy still "faces pressures to slow in the coming period."

The quarterly growth appeared to be lowest in at least a decade though China has repeatedly revised its historical data, making comparisons difficult. Analysts said the 6.8 percent rate in the fourth quarter was the lowest since 2001 and possibly earlier.

The economy has shown tentative signs its slump might be bottoming out, with bank lending and investment rising and auto sales hitting a new monthly high in March. But the government has cautioned that a possible rebound is still fragile and not yet certain, and has called for renewed efforts to boost growth.

Beijing is carrying out a 4 trillion yuan ($586 billion) stimulus package to shield the country from the global slump. It hopes to reduce reliance on slumping trade by boosting domestic consumption.

The collapse in global demand for Chinese goods threw at least 20 million people out of work as factories closed. It is unclear how many of those workers might have found new jobs in projects financed by the stimulus package.

Chinese exports fell 17 percent in March, the fifth straight monthly decline, but that decline was less severe than February's 25.7 percent plunge. Analysts said that suggested trade was stabilizing, though they said exports should remain weak this year.

Consumer spending rose 15 percent in the quarter, the bureau reported, though that rate was slightly lower than growth reported for previous months.

Consumer prices fell by 1.2 percent in March, the data showed, leaving Beijing room to cut interest rates further to boost growth while avoiding fueling pressure for prices to rise.

Industrial production rose 5.1 percent in the quarter, though that was 11.3 percentage points lower than the growth for the same period of 2007.

Investment in factories and other fixed assets during the quarter grew by 28.6 percent from the year-earlier period, the bureau reported. Li said that was higher than the growth rate for the same period of 2008, though he gave no details.

By Joe McDonald(AP)