China's industrial production grew by 6.1% year-on-year in April 2025, surpassing market expectations of a 5.5% gain but easing from the 7.7% surge recorded in March—the fastest pace of expansion since June 2021.
China industrial output growth beats estimates
The deceleration highlights the ongoing volatility in industrial activity, with factories adjusting to shifting global demand dynamics, supply chain normalization, and lingering trade uncertainty. The March spike was largely attributed to accelerated production ahead of anticipated U.S. tariff hikes, which had prompted front-loading of orders.
In April, growth softened across all major sectors. Manufacturing output rose by 6.6%, down from 7.9% in March, as both domestic and export demand showed signs of fatigue. Output in utilities—comprising electricity, heat, gas, and water production and supply—slowed to 2.1% from 3.5%, possibly reflecting milder weather and moderating industrial energy consumption. Mining activity also decelerated significantly, with growth falling to 5.7% from 9.3%, amid fluctuating commodity prices and more cautious extraction plans.
Manufacturing figures
Within the manufacturing sector, 36 out of 41 major industries reported year-on-year growth, underscoring the broad resilience of China’s industrial base despite a challenging global environment. Notable performers included computer and communication equipment manufacturing, which rose 10.8% as AI- and data-related demand remained strong, and non-ferrous metal smelting and rolling, which expanded 7.5% on stable construction and EV battery demand. Chemical product output increased 8.0%, supported by restocking and improved margins, while car manufacturing rose 9.2%, buoyed by seasonal promotions and government incentives for clean vehicles. Ferrous metal processing (5.8%), coal mining (6.3%), textiles (2.9%), and oil and natural gas extraction (4.3%) also contributed positively. Heat production, however, recorded more modest growth at 1.2%, reflecting subdued residential energy use.
On a monthly basis, industrial output edged up by 0.22% in April, indicating that although the growth rate moderated, the sector maintained forward momentum. Cumulatively, industrial production rose by 6.4% in the first four months of 2025, reflecting a slight improvement over the 5.8% annual increase recorded in 2024.
Despite the recent gains, analysts caution that the outlook remains uncertain. While domestic demand is showing tentative signs of stabilization and external demand has benefited from a temporary easing in U.S.–China trade tensions, risks persist. The potential re-escalation of tariffs after the current 90-day truce, elevated input costs, and fragile global growth could all weigh on future output. In response, Chinese policymakers are expected to maintain a pro-growth stance, with targeted support for strategic industries, enhanced credit access for small manufacturers, and potential infrastructure-driven demand to buffer against any external shocks.
