China’s manufacturing resilient in April despite US tariffs, but consumption softens

China’s economy mostly remained resilient in April, despite feeling the effects of the astronomical tariffs in effect before last week, when Washington and Beijing agreed to remove or pause most of the duties imposed as part of their tempestuous trade war.

With the new agreement providing a 90-day reprieve in the conflict, last month was the only period where the full force of the triple-digit tariffs could be observed in economic data – at least for now.

China’s industrial output grew by 6.1 per cent in April from a year earlier, compared to 7.7 per cent growth in March, according to data released by the National Bureau of Statistics on Monday, higher than the 5.21 per cent growth estimate from a poll of economists by financial data provider Wind.

The impact of external shocks increased in April, said Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and the director general of its Department of Comprehensive Statistics. However, major indicators showed steady and rapid growth due to coordinated macroeconomic policies that helped the national economy to withstand pressure, he added.

At a meeting of the country’s Politburo in late April – a Communist Party conclave which typically sets the tone for the country’s economic work in the second quarter – the high-level political body vowed to “resolutely focus on doing our business, steadfastly expand high-level opening up and focus on stabilising employment, businesses, markets, and expectations” in a statement.

The rhetoric was seen as affirmation of the need to shore up domestic consumption in an environment where the future of global trade is less than certain.

Retail sales rose by 5.1 per cent during the same period, compared with the 5.9 per cent growth observed in March, falling short of Wind’s 5.48 per cent estimate.