China’s economy showed mixed performance in April 2025, facing external pressure but retaining some resilience.

Industrial output rose 6.1% year-on-year in April 2025, a decline from 7.7% in March 2025 but exceeding market expectations.

Retail sales growth weakened to 5.1%, though automobile retail sales jumped 14.5% year-on-year due to trade-in incentives.

Fixed-asset investment rose 4% in the January to April 2025 period, while property investment declined 10.3%.

The urban unemployment dipped to 5.1% in April 2025, down from 5.2% in March 2025.

During the three-day Ching Ming Festival, domestic travel and tourism revenue increased by 6.3% and 6.7% year-on-year, respectively.

🔗 Source: South China Morning Post

🧠 Food for thought

1️⃣ China’s strategy shift toward domestic resilience is showing results

The better-than-expected industrial output growth of 6.1% in April demonstrates China’s partial success in its economic rebalancing strategy during peak tariff pressure1.

This resilience comes directly from China’s explicit “do our business” approach emphasized in the late April Politburo meeting, which prioritized domestic consumption to offset external trade uncertainties2.

The government’s consumer goods trade-in program has proven particularly effective, with automobile retail sales volume surging 14.5% year-on-year in April according to the China Passenger Car Association3.

These policy interventions reflect China’s ongoing efforts to reduce dependence on exports, a strategy accelerated by the trade tensions that began escalating in early 2018 when tariffs were first imposed on billions of dollars of goods4.

The April performance suggests China’s economy has developed some immunity to trade shocks compared to 2018-2019, when analysts estimated tariffs would reduce GDP by 0.25% to 0.39%4.

2️⃣ The real economic cost of triple-digit tariffs has been dramatic but varied

April offered a unique window into the full impact of unprecedented triple-digit tariffs before the recent 90-day reprieve that reduced U.S. tariffs from 145% to 30% and China’s from 125% to 10%5.