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The trucks are lined up in a container terminal near Porto Longton Portin, Jiangsu province, China, on the evening of April 8, 2025.
Cfoto | Future Edition Gets the image
Beijing – Citi on Tuesday became one of the first investment firms that reduced growth forecast in China by escalation of trade tensions with the US
In less than a week, US tariffs for China’s goods have doubled, while Beijing has repelled more duties and restrictions on US business.
Citi analysts have reduced their prognosis for China’s gross domestic product to 4.2% this year, declining by 0.5 percentage when they see “a small deal between the US and China after a recent escalation.”
Natixis also told reporters on Monday that this year the firm had reduced the GDP of China to 4.2%, which is 4.7% earlier.
Morgan Stanley and Goldman Sachs have not yet reduced their forecasts, but have been warned this week about increasing the risk of reducing their expectation – now they predict 4.5%.
China in March announced its official growth The goal will be ‘about 5%“For 2025, but stressed that it would be difficult to reach the goal.
“The main issue is that the uncertainty for the economy is growing,” Hao Zhou, Chief Economist Guotai Junan International said on Tuesday, translated by CNBC. He noted that the visibility of future growth has decreased significantly, while the US tariffs can continue to rise.
US President Donald Trump has announced an additional 50% of Chinese goods tariffs to enter into force on Wednesday after Beijing raised duties for all US products by 34%. As part of its wide tariff plan in several countries, the White House said last week that a 34% collection of Chinese goods would be added.
Combined with two rounds by 10% increased earlier this year, new tariffs for Chinese products in 2025 have reached 104%.
Reducing the impact of new tariffs
While initially increasing duties by 50% may reduce Chinese GDP by 1.5 percentage points, the next 50% increase will drag it to a lower 0.9 percentage item, according to the Goldman Sachs analytics report.
Chinese exports to the United States are about 3 percentage points of China’s total GDP, Goldman noted, noting that it includes 2.35 percentage points of the domestic value and 0.65 percentage points related to production investment.
China is expected to report on March trading data on Monday and GDP first quarter on April 16.
Nomura now expects China’s exports to fall by 2%this year, which is worse than their previous expectation, said Chinese Chinese economist Tin Lou in the report.
But he retained his GDP forecast in 2025 by 4.5%. “Given the extraordinarily flowing situation, it is impossible to reasonably evaluate the influence of the permanent trade war in the US and China on China’s economy,” he said, adding that his forecast is already much worse.
This week, China signaled that it may soon reduce their interest rates or increase financial costs to increase growth.
Reducing tariff impact can also be rooted in the calculation in Beijing, which is most likely in the US to say that China’s chief economist, Chinese chief economist.
“In terms of Beijing, strategic profits of strong revenge now exceed the related economic costs,” she said.
