According to the National Bureau of Statistics data, China’s industrial output rose 6.1% compared to a year earlier.

China’s factory output topped expectations in April, as the world’s second-largest economy showed signs of strength amid a tariff showdown with the U.S. that threatened to weaken growth.

However, retail sales growth slowed, which analysts said is a sign that consumer sentiment remains weak amid heightened uncertainty.

According to the National Bureau of Statistics data, China’s industrial output rose 6.1% compared to a year earlier. The growth rate topped economists’ expectations of 5.5% according to a Reuters poll.

Earlier this month, customs data showed that exports from China were above estimates in April as countries rushed to boost their inventories before the U.S.'s 90-day pause on reciprocal tariffs expires in July.

"The ASEAN countries are speeding up their production to meet the July deadline, the 90-day negotiation break. Their production is highly reliant on China's exports in raw materials and industrial inputs, so China's exports got support," said Dan Wang, China director at Eurasia Group, according to Reuters.

Last week, the U.S. and China also agreed to a mutual pause on the steep tariff rates they imposed on each other following a tit-for-tat tariff war.

However, retail sales rose 5.1% compared to a year earlier, which missed estimates of 5.5% according to a Reuters poll.

Consumer appliance sales rose nearly 40%, aided by government incentives, but property and car sales remained tepid.

“We expect economic activity to regain momentum in May and June on the back of the tariff truce and a push from policy support. Even so, uncertainty will remain a drag on household and business spending,” Bloomberg economist David Qu said.

China has forecasted its economy to grow by 5% this year despite the threats of an economic slowdown caused by the tariffs.

The iShares China Large-Cap ETF (FXI) has gained 18.6% year to date (YTD), while the Invesco QQQ Trust Series 1 (QQQ) and SPDR S&P 500 ETF (SPY) have risen 1.4% and 0.8%, respectively.

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