China’s economy grew by 5.4% year-on-year in the first quarter of 2025, exceeding forecasts of 5.1% and matching the previous quarter’s performance. This growth was driven by robust domestic consumption and industrial output, with exports surging as factories expedited shipments ahead of new U.S. tariffs.
However, escalating trade tensions with the United States pose significant risks to sustained growth. The U.S. has imposed tariffs of up to 145% on Chinese goods, prompting retaliatory measures from Beijing. Analysts warn that these developments could dampen export momentum and industrial activity in the coming months.
Despite the strong start to the year, challenges persist. Property investment declined by 9.9% year-on-year in Q1, reflecting ongoing weaknesses in the real estate sector. Economists anticipate that without additional policy support, growth may slow in subsequent quarters.
