China’s economy posted its lowest quarterly growth rate in three years, expanding 4.5% year-on-year in the final quarter of 2025. Softer domestic demand and lingering concerns over the property market weighed on the figures, even as the country met its full-year growth target.
Data released by the National Bureau of Statistics revealed that gross domestic product (GDP) reached 140.19 trillion yuan in 2025, growing 5.0% for the year and matching Beijing’s annual target. Despite resilience earlier in the year, driven by moderate U.S. tariff adjustments and efforts by exporters to tap new markets, the economic momentum slowed toward year-end due to weaker consumer and business confidence.
The fourth quarter’s 4.5% expansion was slightly above consensus forecasts but fell short of the previous quarter’s 4.8% pace, marking the slowest quarterly increase since 2022. Analysts had anticipated 4.4% growth for the quarter. Quarterly growth rates throughout 2025 showed a steady deceleration, with year-on-year GDP growth at 5.4% in the first quarter, 5.2% in the second, 4.8% in the third, and 4.5% in the fourth.
Full-year sectoral data showed the primary industry increasing 3.9% to 9.33 trillion yuan, while the secondary industry rose 4.5% to 49.97 trillion yuan. The service sector led with a 5.4% gain to 80.89 trillion yuan. Manufacturing remained an area of strength, with China reporting a record trade surplus of $1.2 trillion in 2025, largely thanks to strong export growth in non-U.S. markets, offsetting U.S. trade barriers.
Nonetheless, domestic economic challenges persist. Lending activity slowed sharply, with new bank loans falling to 16.27 trillion yuan— the lowest level in seven years— reflecting subdued borrowing appetite. Deflationary pressures and an ongoing property downturn continue to weigh on household and corporate sentiment, prompting calls for additional policy support.
