China posts 5% Q1 growth
China’s economy grew about 5% year‑on‑year in the first quarter, surprising some forecasters and showing resilience despite geopolitical shocks tied to the Iran war. At the same time, new U.S. data show direct trade between the U.S. and China is still shrinking amid tariff tensions, underscoring a split between domestic momentum and cross‑border commercial friction. (abcnews.com, scmp.com)
China said its economy grew 5.0% in the first quarter, a faster pace than late 2025 and above many economists’ forecasts. (stats.gov.cn) The National Bureau of Statistics reported gross domestic product of 33.42 trillion yuan, or about $4.9 trillion, for January through March. Reuters said economists had expected about 4.8% growth after 4.5% in the October-December quarter. (stats.gov.cn, msn.com) Industrial output rose 6.5% from a year earlier in March, retail sales increased 5.9%, and fixed-asset investment climbed 4.2% in the first quarter, according to the same release. The statistics bureau also said the urban unemployment rate averaged 5.3% in the quarter. (stats.gov.cn) The quarter covered the opening weeks of the Iran war, which raised concerns about oil prices, shipping routes and factory supply chains. AP reported that the early disruption had not yet knocked China off its growth path in the official data released April 16. (abcnews.com) At the same time, direct goods trade between the United States and China kept falling. U.S. Census Bureau data show U.S. imports from China totaled $40.0 billion in January and February 2026, while exports to China were $16.3 billion. (census.gov) South China Morning Post reported on April 3 that the bilateral goods deficit had dropped to its lowest level in about two decades as trade shifted toward places including Mexico, Vietnam and Taiwan after last year’s tariff escalations. The paper tied the decline to continued tariff pressure ahead of a possible leaders’ meeting. (scmp.com) That leaves two different pictures running at once: stronger domestic activity inside China and weaker direct commerce with the United States. Beijing’s first-quarter numbers suggest government stimulus and consumer spending are supporting growth even as trade friction with Washington persists. (stats.gov.cn, census.gov) Beijing set its 2026 growth target at about 5%, and the first-quarter result puts it on that pace early in the year. The next test is whether exports, energy costs and factory demand hold up through the spring after the Iran shock and continued tariff pressure. (msn.com, stats.gov.cn)
