China’s economy posted a 5.4% year-on-year growth in the first quarter of 2025, largely fueled by a surge in exports as companies rushed to ship goods ahead of rising U.S. tariffs. However, quarterly growth slowed to 1.2%, down from 1.6% in the previous quarter.
Despite solid performance in manufacturing and advanced tech sectors, concerns are growing as the U.S. imposes tariffs of up to 145% on Chinese imports. Beijing has responded with 125% duties on U.S. goods, while seeking to boost domestic consumption and investment.
Challenges remain with weak consumer demand, falling property investment, and mounting trade uncertainty. UBS has lowered its growth forecast for China to 3.4%, warning of a sharp decline in exports if the tariff dispute persists.
