China’s Economy Grows 5% in Q1, Beating Forecasts

China’s economy expanded faster than expected in the first quarter of 2026, signaling resilience despite global geopolitical tensions.

China’s economic momentum has so far been insulated from the Iran conflict.

Data from the National Bureau of Statistics of China showed gross domestic product grew 5% year-on-year, surpassing the 4.8% forecast by economists surveyed by Bloomberg.

The growth marks an acceleration from 4.5% in the previous quarter, supported by strong industrial output, which rose 5.7% in March. However, retail sales growth slowed to 1.7%, indicating softer consumer demand.

Economists, including Hao Zhou of Guotai Junan International, noted that manufacturing remains a key driver of growth.

China’s economic momentum has so far been insulated from the Iran conflict, aided by efforts to strengthen energy security and manage inflationary pressures.