Chief Economists Outlook May 2025

15Chief Economists Outlook China has targeted GDP growth of 5% for 2025. This is unchanged from its target for 2024, but it is likely to be more difficult to achieve given the roiling of the global trade landscape in recent months. Among chief economists surveyed, 69% expect moderate growth, while another 20% anticipate that growth will remain weak for the rest of 2025. There is no clear consensus among them on whether China will ultimately reach its 5% growth target; the IMF recently revised its forecast for this year down to 4%, but this was before the de-escalation of US-China trade tensions in May.29 It remains to be seen how much relief this de-escalation will offer, but it is important to note that despite the temporary reduction of bilateral tariffs by 115 percentage points, the US is still imposing additional 30% tariffs on many imported goods from China (with China maintaining a 10% tariff on many goods imported from the US).30 Figure 12. China’s 5% target Looking ahead to the remainder of 2025, do you agree/disagree with the following? Share of respondents (%)Strongly disagree Disagree Uncertain Agree Strongly agree China will reach its 5% GDP growth target for 2025 16 30 32 19 3 Source: Chief Economists Survey. (2025, April). The vast majority of respondents expect looser fiscal and monetary policy in China, with 87% and 73% anticipating more accommodative stances, respectively. Monetary policy in China must contend with longstanding deflationary risks, reflected in the fact that 69% of respondents expect low or very low inflation this year. On the fiscal side, the government’s latest fiscal package aims to support demand by raising the deficit to 4% and increasing the spending capacity of local governments.31 Consumer confidence in March 2025 remained well below levels seen in the US and the Eurozone.32 The real estate sector continues to weigh on the outlook, as efforts to address excess leverage and stabilize housing markets have resulted in subdued investment and ongoing financial stress among property developers.33 At the same time, China’s innovation ecosystem remains dynamic,34 with strong growth in artificial intelligence (AI)35 and other frontier technologies providing a counterbalance to broader economic challenges. 29 International Monetary Fund (IMF). (2025b). 30 Sevastopulo, D. et al. (2025). 31 Li, Q. (2025). 32 International Monetary Fund (IMF). (2025b). 33 The Economist. (2025f). 34 Allen, G.C. (2025). 35 The Economist. (2025g).