China’s Economic Growth Slows as Property Woes and Trade Tensions Pressure Policymakers

China’s economic growth is expected to hit a one-year low in the third quarter of 2025, as a prolonged property crisis and renewed U.S.-China trade tensions weigh heavily on demand and investor confidence. According to a Reuters poll, gross domestic product (GDP) likely expanded by 4.8% year-on-year from July to September, down from 5.2% in the previous quarter, signaling slower momentum amid global and domestic challenges. Analysts predict full-year growth will reach 4.8%, just shy of Beijing’s official 5% target, with a further slowdown to 4.3% forecast for 2026.

Beijing has introduced measured stimulus efforts to preserve room for future policy action, while resilient exports and strong stock markets have provided some relief. However, with Washington threatening to hike tariffs on Chinese goods by 100% from November 1, economic uncertainty remains high. Although both sides have expressed willingness to ease tensions, China’s heavy reliance on manufacturing and exports underscores the need for economic rebalancing toward domestic consumption.

On a quarterly basis, GDP growth is expected to have eased to 0.8% in Q3 from 1.1% in Q2. Analysts anticipate moderate stimulus ranging from 500 billion yuan ($70 billion) to 1 trillion yuan in the second half of the year. The People’s Bank of China is also likely to cut key rates by 10 basis points in the coming months to support growth.

Policymakers face a difficult balancing act—stimulating the economy without worsening structural imbalances or deflationary pressures. As Chinese leaders prepare for the upcoming Central Economic Work Conference and 15th five-year plan discussions, focus will likely shift to boosting high-tech manufacturing and domestic demand to secure long-term sustainable growth.