China’s economy grew 5.4% in the first quarter of 2025, surpassing analysts’ expectations and maintaining momentum despite looming trade tensions with the United States.
The better-than-expected performance, reported by China’s National Bureau of Statistics (NBS), comes as the world’s second-largest economy faces increasing headwinds from increased U.S. tariffs and domestic challenges. Economists had projected growth of about 5.1% for the quarter.
“With the continued implementation and effectiveness of various macroeconomic policies, the national economy has made a steady start and had a good beginning to the year,” stated NBS, according to EuroNews.
According to official data, the Q1 GDP represents approximately $4.42 trillion in economic output and maintains the same growth pace as the previous quarter.
March economic indicators showed particular strength, with both retail sales and factory output exceeding forecasts.
Despite the positive numbers, Chinese officials remain cautious about the economic outlook. The NBS acknowledged that “the external environment is becoming more complex and severe, the drive for the growth of effective domestic demand is insufficient, and the foundation for sustained economic recovery and growth is yet to be consolidated,” MyNews reported.
While robust compared to many developed economies, the 5.4% growth rate remains below China’s historical average of 8.78% since 1989. In recent decades, China has seen growth rates fluctuate dramatically, reaching as high as 18.90% and falling as low as -6.80%.
Economists are closely watching how escalating trade tensions with the United States might impact future quarters, as hefty tariffs could potentially dampen China’s export-driven sectors and overall economic momentum.