Despite the implementation of reciprocal and retaliatory tariffs by the US, China’s economy remains strong in April. According to UOB Group’s economist Ho Woei Chen, the impact on industrial production has been limited due to frontloading in other markets after the US paused its tariffs. However, retail sales and urban fixed assets investment showed weaker performances than expected in April as a result of uncertainty. The property market is also a concern for policymakers, with home prices, property investment, and residential property sales seeing a decline in April. Looking ahead, China’s GDP growth forecast for 2025 has been revised upwards to 4.6% from 4.3%, due to the short-term boost from the 90-day US-China trade truce. The outlook for China’s economy remains uncertain and will depend on the durability of a trade agreement between the US and China, as well as the eventual tariff rates. In order to stabilize the economy, China’s stimulus measures will provide additional support. UOB Group maintains their forecast for a 0.1% interest rate cut in the fourth quarter of 2025. They predict that by the end of 2025, the 7-day reverse repo rate, 1Y LPR, and 5Y LPR will be at 1.30%, 2.90%, and 3.40% respectively.