China’s economy is growing at a slower rate than the official figures show, but growth has held steady at around 3% for the past year. Exports continue to surge on the back of strong global demand for AI and green-tech products. We expect them to remain strong for some time. But domestic demand is tepid. There are some reasons to be upbeat about the near-term outlook for consumer spending though. And the budget for 2026 suggests that fiscal spending should ramp up significantly over the rest of the year. As a result, we expect growth to pick up over Q3 and Q4.