Amundi lifts China growth forecasts

Patrick Buncsi

16 May 2025

Europe’s leading asset manager has forecast a modest uplift in China’s GDP growth, as the US moves to de-escalate its trade fracas with its second-biggest trading partner.

Amundi’s latest estimate gives China a 40-basis-point lift in GDP growth for 2025, hitting 4.3% (up from 3.9% in its previous forecast). For the following year, the world’s second biggest economy is predicted to reach 3.9% GDP growth, up from Amundi’s previously forecast 3.7%.

Amundi said recent US-China trade talks have “exceeded expectations”, noting that within the 145% tariff, the retaliatory 91 percentage point levy, initiated by the US on 8 April, has been fully removed, not simply suspended.

The outcome of US-China trade talks has now significantly reduced the probability China will initiate additional fiscal stimulus in Q3, Amundi said, with the 90-day pause “[buying] enough time through mid-August” for the country’s policy rate setter, the People’s Bank of China (PBoC).

“Amundi maintains its forecasts that PBoC will proceed with two additional 10bp rate cuts in July and September.

“As April CPI/PPI shows, deflationary pressures have been persistent, and further monetary easing is much needed regardless of the results of the negotiations,” said Amundi Investment Institute strategist Claire Huang.

She cautions, however, that while the tightening in global financial conditions “was brief and has since normalised… uncertainty surrounding trade policy remains elevated, continuing to weigh on private sector confidence”.

As such, Huang added, tariff policies are “likely to have lasting effects”.