The Chinese economy has proven solid this year despite the ongoing trade disputes, mainly with the United States. In the second quarter of 2025, it grew 5.2 % year on year. On a seasonally-adjusted quarter-on-quarter basis, GDP growth was 1.1%, slightly less than the expansion of 1.2% in the first quarter.
Exports continue to grow strongly despite turbulent tariff policies and negotiations with the United States. Domestic demand, however, is weak and is likely to stay so. The problems in the real estate sector and high public and private debt dampen consumption. House prices, sales, and building activity have all remained depressed. At the same time, however, China has developed an advanced position in a number of industries such as artificial intelligence, electric vehicles, and solar panels. In the second half of 2025, we expect somewhat lower economic growth as exports will be less dynamic. The People’s Bank of China is expected to continue to cut interest rates against the backdrop of low inflation and weak domestic demand.
Overall, we expect the Chinese economy to expand by 4.6 % in 2025 followed by somewhat lower growth rates in 2026 and 2027 (4.0 and 3.8 %). Inflation will remain low.
Kommentar verfassen