China’s economy expanded 5% year-on-year in 2024, with a rebound in the last quarter of the year, when a series of stimulus measures came into effect that helped meet Beijing’s growth target.
Fourth-quarter GDP exceeds expectations with growth of 5.4%, according to China’s National Bureau of Statistics. Economists surveyed by Reuters had estimated growth of 5.0% in the last quarter.
This is faster growth compared to 4.6% in the third quarter, 4.7% in the second quarter and 5.3% in the first quarter.
Full-year economic expansion was weaker compared to 5.4% growth in 2023 after the pandemic. As part of an annual review of preliminary figures, the statistics office in late December revised 2023 GDP growth to 7.4%, according to a CNBC calculation of official data. In December, retail sales rose 3.7% from a year earlier, beating Reuters figures. forecast of 3.5%. Industrial production grew 6.2% from a year earlier, compared to expectations of 5.4%, underscoring China’s imbalance between domestic production and weak demand.
Investment in fixed assets rose 3.2% in 2024, compared to a projected 3.3% increase in a Reuters poll.
China has been striving to boost economic growth and has taken several measures to this end.
Since late September, Chinese authorities have called for halting the decline in the real estate sector, cutting interest rates and announcing a five-year fiscal package worth 10 trillion yuan ($1.4 trillion) to ease the financial crisis. of local governments. Beijing has also expanded a program for consumers to trade in used cars and appliances and buy new ones at a discount.
Top leaders have promised “proactive” fiscal measures and a “moderately flexible” monetary policy stance for the current year.
Some analysts expect the stimulus to start taking effect this year, but it will take longer to see a significant impact.
The housing sector slump and uncertainty about future incomes have weighed on consumer spending and business confidence, adding to concerns about deflation.
China’s consumer inflation has remained just above zero, while wholesale prices fell for the 27th straight month in December, official data showed last week.
The government is expected to reveal official growth targets for 2025 and additional stimulus measures at annual parliamentary meetings in March.
Economists predict China will keep its 2025 GDP growth target at around 5%, if not slightly below.
Friday’s data comes days before Donald Trump is sworn in as the next US president on January 20. Trump has said that soon after taking office, he plans to impose additional tariffs of at least 10% on Chinese goods. He has also appointed some China hawks to key cabinet positions.
