China Stocks Gain But Growth Outlook Darkens Under Trade and Job Concerns

China Decoupling Gains Momentum As the US escalates measures against china-ramping up Tariffs and Blacklving Tech Firms to Curb Beijing’s AI AMBitions – The US Economy Is Showing Further SIGNS OF STRESS.

On March 31, Nick Timiraos, Chief Economics Correspondent for the Wall Street Journal, Commented On US Inflation, The Economic Outlook, and The Fed’s Rate Path, Stating:

“Goldman Now Expects Core Pce to Rise to 3.5% This Year Versus 3.0% Under Previous Assumptions for Less Aggressed Tariffs Employment. ”

Goldman Also Raissed The ODDS of A 2026 Recession to 35%, up from 20%, City Trump’s Tariffs. Goldman’s Outlook Followed Fmoc Economic Projects, Which Cut The 2025 GDP Growth Forecast from 2.1% to 1.7%.

These Adjustments Are In Contrast to Growing Optimism from Institutions About China’s Outlook. Several Global Institutions Have Raised Their China Growth Forecasts:

• World Bank: 4.5% GDP Growth for 2025, Up From A Previous 4.1% Forecast.
• OECD: RAISED ITS 2025 GDP Growth Project from 4.7% to 4.8%.
• Morgan Stanley: Increased 2025 GDP Growth Forecast from 4.0% to 4.5%.
• S&P Global: 10% Tariffs to Slow China’s GDP Growth To 4.1% In 2025.
• IMF: Projected GDP Growth of 4.6%

Is China Weathering the Trump Storm? It May Be Too Early to Tell Wheether China is Weathering the Trump Storm. Recent Strength in Economic Indicators May Reflect Front-Loading Activity As Firms Race to Beat Tariff Deadlines.

While Financial Institutions Have Upwardly Revised Growth Forecsts, Economists Remain Divide:

Chief Global Strategist and the Director of Research at Bca, Peter Berezin (Formerly with Goldman and the IMF), Commented:

“The Global Economy Is Currently Benefiting from Massive Tariff Front-Running, As EvidenCed by the Surge in Imports to the Us. This had temporarily proponed Up. The Floor Falls Out Next Week. ”

With Auto Tariffs Effective April 2 and Reciprocal Tariffs Likely to Follow, The Front-Loading Effect Will Fade. Sweeping Tariffs Also Make It Harder for China to Bypass Levies Through Third-Party Routes Like Mexico. This raises the risk of a demand slump for chinese automakers and tech abirms – ThoUGH Such Effects May Not ImmediaTely Show in Trade Data. Insthead, Corporate Earnings Could Offer A Cleerr Gauge of the Damage.

Risks to China’s Recovery Weaker Demand May Dampen Investment and Hiring in China. Rising unemployment in China Could Limit the Effectiveness of Beijing’s Stimulus Measures Aimed at Boosting DOMESTIC DEMAND.

In February, China’s Unemployment Rate Jumped to 5.4%, up from 5.1% in january. Notably, Youth Unemployment Rose From 16.1% To 16.9% In February, Painting A Far Gloomier Picture.

A Beijing Res at Us Tariffs May Stoke Fears of a Full US-CHINA Trade War. The Kobeissi Letter Signrated A Potential Tariff Respense on March 31:

“China, Japan and South Korea Will Jointly Respond to Us Tariffs As President Trump’s April 2nd Reciprocal Tariff Day Nears, Per Reuters. MEXICO HAS ALREADY ANNOUNCED THAT 3RD.

Mainland and Hong Kong Equities Show Resilien Optimism over Beijing’s Policy Support Has Bolstered Demand for Hong Kong and China Stocks. The Hang Seng Index Is Up 15.25% Year-To-Date (YTD), While China’s CSI 300 is Down Just 1.21%. In Contrast, The Nasdaq composite have been declined 10.29%.

Significantly, The CSI 300 Fell 0.07% in March, While The Hang Seng Index Gained 0.78% Versus an 8.21% MONTHLY DECLINE FOR THE NASDAQ composite Index. If Beijing Succeeds in Cushing ITS Key Sectors from US Tariffs, The Divergence Between Chinese and US Equity Markets May Grow.

However, if Beijing Disappeints or Geoplitical Tensions Escalate, The Hong Kong and Mainland China Markets have a long Way to Fall.