China’s economy grew 5% for the full year, despite a slowdown in the final quarter, fuelled by growing trade friction with the United States and the prolonged real estate slump.
Gross domestic product (GDP) for Q4 of 2025 grew 4.5% according to data from the National Statistics Bureau, marking a slowdown from 4.8% in the quarter.
It was also the weakest reading since the first quarter of 2023, which also saw an increase of 4.5%.
This slowdown is likely to put more pressure on Beijing to meet an expected target of between 4.5% and 5% GDP growth for 2026.
The country met its full-year GDP growth target of 5%.
Retail sales grew by 0.9% in December from the year earlier, missing economists’ expectations for 1.2% growth and slowing from 1.3% in November.
Industrial output climbed by 5.2% in the final month of 2025, topping expectations of 5% growth and up from 4.8% in the previous month.
Fixed-asset investment, which includes real estate, contracted 3.8% last year, worse than economists’ forecast for a 3% drop in a Reuters poll.
The unemployment rate came in at 5.2% for the year and 5.1% in December, remaining unchanged from the month before.
Property investment declined by 17.2% for the year, falling further than analysts' expectations of 16.5% on the back of China’s fourth consecutive year of property downturn.
New construction also fell by 20.4%.
Despite its ongoing tariff war with the U.S., causing exports from America to fall 20%, China remained resilient through diversifying its trade output away from the U.S.
This led to the country reporting a trade surplus of US$1.2 trillion for 2025, driven by increases in trade to the European Union and Southeast Asia.
However, China’s inflation hit a three-year high of 0.8% during December.
