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No. 93
China’s Economic Trajectory: Unpacking Macroeconomic Trends and Structural Reforms
Alfred SCHIPKE (席睿德), HUANG Yiping (黄益平) and GUO Kai (郭凯), 11 July 2025
In early 2025, China’s economy regained some momentum after facing significant headwinds in 2024, when reduced fiscal spending and a sharp property downturn weakened aggregate demand. Policy actions, including a sweeping plan to resolve hidden local government debts and calibrated monetary easing, helped stabilise growth by late 2024 and carried strength into 2025. In the near term, these measures underpinned solid gross domestic product (GDP) and industrial output during the first few months in 2025, supported by early signs of property market stabilisation and resilient household consumption. Yet persistent low inflation, cautious private investment and heightened external risks from US tariffs underscore the fragility of the macroeconomic recovery, which remains uneven and vulnerable to shocks.
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