China in the first quarter of GDP is estimated at 5.4%because the rush of growth continues in connection with the fears of the tariff

In the first quarter, China's economy has expanded to better than 5.4%, maintaining strong impetus, even as tariff threats in the US prompted the main investment banks to reduce the national growth perspective.

In the first quarter, GDP exceeded Reuters' expectations at a 5.1% increase from year to year, based on revival, which began at the end of 2024, thanks to wide political stimuli.

Retail sales in March increased by 5.9% year on year, According to data from the National Statistics Bureau On Wednesday, he rapidly overcomes analysts for an increase of 4.2%. Industrial production increased by 7.7% compared to the year earlier, compared to the median of estimates of 5.8%.

In the first quarter, investments in fixed assets increased by 4.2% compared to estimates by a 4.1% increase in Reuters survey. However, the resistance from the property worsened as part of investment in fixed assets, it fell by 9.9% in March, while infrastructure and production investments increased.

The unemployment rate in the city dropped to 5.2% in March, after Two -year level 5.4% in February

The statistical office described the Chinese economy as “on a good and constant start” and emphasized how “innovation (former) plays an increasingly leading role.” The Chinese startup Deepseek in January revealed his breakthrough AI that he was competing with American OpenAI technology.

But the office warned that “the external environment is becoming more complex and serious”, and domestic demand remains insufficient.

Despite the optimistic monthly data in March, “Damage as a result of a trade war will appear in the macro data next month,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, noting that “high frequency indicators suggest export (they had) slowed down in the region.”

This year, the Chinese management set an ambitious annual goal of growth “about 5%”, which is more difficult to achieve, given the perspectives of the escalation of the trade war and PersisTPoorly poor national consumption.

“We need to implement more proactive and effective macro policies, expand and strengthen the national economy … and actively respond to uncertainty of the external environment,” said the statistical office in a communication in English.

The Tit-For-Tat tariff war from the US brought total fees imposed by the US President Donald Trump on Chinese goods up to 145%, attracting retaliation from Beijing in order to raise fees for American goods to 125%. It is expected that such levels of import duties decorate China's export and repeat several percentage points from the expansion of the economy this year.

“Growth will probably deteriorate rapidly from the second quarter, taking into account the low possibility of short -term bilateral negotiations in order to establish offramp for a 125% tariff increase,” said a team of economists in Morgan Stanley in a note at the beginning of this week.

Several investment banks have reduce China growth forecasts This year, most economists would doubt Beijing, will achieve their official goal, citing winds from a significant growth of American tariffs to Chinese goods.

On Tuesday, the UBS group added to a number of reductions in growth with the most pessimistic forecast among large banks, predicting that the Chinese economy will expand only 3.4% this year as the export of American tariffs. The investment bank displays China exports to the USA to fall by two -thirds in the coming quarters, and general exports dropped by 10% in dollars this year.

Pressure is based on Chinese officials to release more strong measures in stimuli to support the domestic consumption and the housing market, while reducing the dependence of the economy on exports and investment.

The chief economist Morgan Stanley, China, Robin Xing, expects the Chinese authorities release the stages of monetary relief in the second quarter, with a reduction in 50-units in relation to reserve requirements and a reduction in interest rates.

Beijing will probably speed up the issue and implementation of local construction bonds and increase the program of trading in consumer goods with broader insurance or more generous subsidies, as well as the pursuit of local governments to obtain housing inventory, according to Morgan Stanley.

Xing also expects Beijing to reveal an additional fiscal stimulus 1-1.5 trillion in the second six months to ensure a partial shock of tariff shock.