China's No. 2 official is urging authorities to roll out forceful policy support, state media say, as signs of economic stress emerge from Beijing's trade battle with the U.S.

Chinese Premier Li Qiang encouraged officials to "dare to break norms," saying the government should act swiftly to shore up market expectations, the state-run Xinhua News Agency reported.

The comments were made at a meeting Thursday, a day after official data showed that China's economy grew more than expected in the first quarter. But economists say that is of little comfort when tariffs slapped on China by President Trump in his second term stand at 145%.

Trade concerns prompted a flurry of downgrades by forecasters this week, including from UBS economists who now see China's economic growth at just 3.4% this year, a far cry from the official target of around 5%.

Focus is on whether the world's two largest economies can reach a trade deal, as talks between the U.S. and other countries get underway.

President Trump told reporters on Thursday that he is in touch with the "highest levels" of the Chinese government, expressing optimism that a pact could be struck in the next three to four weeks. He declined to say if he had spoken with Chinese President Xi Jinping.

Trump signaled that he may not raise tariffs further because then "people aren't going to buy" products in the U.S. Beijing said earlier this month that China won't match further tariff increases, calling the escalation an economically meaningless "numbers game".

As the U.S. moves ahead with a plan to charge fees on Chinese ships and further limit China's access to advanced chips, attention is on whether Beijing will retaliate with non-tariff measures.

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(END) Dow Jones Newswires

April 18, 2025 03:22 ET (07:22 GMT)

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