In a BoA/Merrill Lynch research note dated 4 May, the bank looks for improving signs in China:

After a very disappointing 1Q, we expect April macro data to show some initial signs of stabilization in economic growth

  • Demand could improve on continued policy easing and production activities have likely returned to normal in April, after being negatively affected by the late Lunar New Year in March
  • We forecast a modest rebound in major activity growth data, including industrial production (IP), fixed asset investment (FAI), and retail sales
  • Trade data could improve too
  • Both CPI and PPI inflation may edge up, and credit growth could remain supported by easing

Is no room for complacency, and further policy easing is required to deliver a growth rebound to around 7% from the sequential growth of about 5 - 6% in the last two quarters, in our view

  • On the monetary policy front, we expect a total of 50bp rate cuts and additional 150bp RRR cuts for the rest of 2015, with a rate cut coming as early as May
  • On the fiscal front, the government will accelerate fiscal spending in key infrastructure projects and cut tax and fees

IP growth could rebound to 6.1% yoy in April from 5.6% in March, helped both by normalization in effective working days and continued policy easing

  • The decline in daily coal consumption at major IPPs narrowed to 9.3% yoy in April from 20.2% in March, pointing to better power demand in the month
  • Daily crude steel production decline at large enterprises widened to 2.3% yoy during 1 - 20 April from - 1.6% in March, per haps indicating continued destocking in the steel sector
  • Iron ore, steel and copper prices rebounded modestly in the month

We expect headline FAI growth (nominal and year - to - date) in April to inch up to 13.6% yoy from 13.5% in March

  • On a monthly basis, FAI growth could improve to 13.8% yoy in April from 13.2% in March
  • The improvement could be mainly led by stronger infrastructure FAI growth, while manufacturing and real estate investment could remain relatively weak

Meanwhile, the headline nominal retail sales growth may rebound to 10.6% yoy in April from 10.2% in March, partly helped by higher retail price inflation, while in real terms retail sales growth could also see some modest improvement