The financial services giant Goldman Sachs is reportedly predicting that the Chinese government will implement fiscal easing to counter US President Donald Trump’s onslaught of new tariffs.

In a new analysis, the investment banking behemoth predicted Trump’s policies would reduce Chinese GDP growth by at least 0.7 percentage points in 2025, per a report from Reuters.

Says Goldman,

“Prior to the tariffs, growth was tracking above our forecasts, and we were contemplating an upward revision to our 2025 GDP expectations…

Based on the evolving situation, there is ample room for adjustment in monetary policy tools such as reserve requirement ratio cuts and interest rate reductions, which can be introduced at any time.”

Last week, Trump issued an executive order that slapped an across-the-board 10% tariff on all imported goods entering the US. His order also detailed country-specific duties, leading to a cumulative 54% tariff on Chinese imports.

China countered with retaliatory tariffs. On Monday, Trump threatened further duty hikes in response.

” … if China does not withdraw its 34% increase above their already long-term trading abuses by tomorrow, April 8th, 2025, the United States will impose ADDITIONAL Tariffs on China of 50%, effective April 9th. Additionally, all talks with China concerning their requested meetings with us will be terminated!”

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