China’s economy grows at steady pace despite Trump’s trade war

China’s GDP grew 1.1 percent from April to June despite US tariffs, official data shows.

China’s economy grew at an annual rate of more than 5 percent in the second quarter, according to official data, staying on track to meet its 2025 growth target despite United States President Donald Trump’s trade war.

China’s gross domestic product (GDP) expanded by 1.1 percent from April to June, data from China’s National Bureau of Statistics showed on Tuesday.

On an annualised basis, China’s economy grew 5.2 percent in the second quarter and 5.3 percent in the first half of the year, keeping in line with Beijing’s full-year target of about 5 percent growth.

“Generally speaking, with the more proactive and effective macro policies taking effects in the first half year, the national economy maintained steady growth with good momentum, showcasing strong resilience and vitality,” the statistics agency said in a statement.

Major Asian stock indices rose on Tuesday, with Hong Kong’s Hang Seng Index and Japan’s Nikkei 225 up about 1.5 percent and 0.5 percent, respectively, as of 8:00 GMT.

Lynn Song, chief economist for Greater China at ING, said China’s economic performance was “certainly encouraging” compared with the “very downbeat expectations at the start of the year”.

“Trade data benefited from frontloading in the first quarter, but generally held up better than expected in the first half as a whole,” Song said in a note.

“As a result, industrial production has outperformed.”

Still, Song cautioned that the second half of the year could “prove to be more challenging”.

“The tariff uncertainty will remain an overhang, with the next key deadlines coming up soon in August. Though we don’t expect a return to the April peak tariffs, we wouldn’t rule out further escalations,” he said.

Despite Trump’s tariffs, exports rose by 5.8 percent year-on-year in June, customs data released on Monday showed, as shipments to non-US markets and a reprieve from the highest duties boosted trade.

After US tariffs on Chinese goods soared as high as 145 percent earlier this year, the Trump administration in May reached a deal with Beijing to scale back taxes on each other’s exports for at least 90 days.

Under the truce, Chinese imports to the US are subject to a minimum duty of 30 percent, while US exports are subject to a 10 percent rate.

The two sides have until August 12 to renew their deal or forge a new agreement to avoid the tariffs reverting to their higher rates.

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