Goldman Sachs Upgrades China’s GDP Forecast Amid U.S.-China Tariff Cuts

Revised Forecasts Reflect Optimism Amid Eased Trade Tensions, but Private Sector Confidence Remains a Concern

Goldman Sachs has revised its growth forecasts for China, increasing its GDP projections for 2025 and 2026 after a larger-than-expected tariff reduction between the U.S. and China. The bank now expects China’s export volumes to remain flat in 2023, up from a previous estimate that predicted a 5% decline.

The revised outlook suggests that the tariff cuts will have less of a negative impact on China’s growth than initially anticipated. As a result, Goldman Sachs has raised its 2025 GDP growth forecast to 4.6% from 4.0% and its 2026 forecast to 3.8% from 3.5%.

However, the analysts at Goldman Sachs also noted that despite the tariff relief, ongoing tensions between the two nations could continue to weigh on private sector confidence, potentially limiting the full recovery of China’s economy.

The shift in the forecast reflects optimism that the easing of trade tensions will provide some stability, but it remains uncertain how these tensions will evolve in the long term.