China's economy expanded 5.4 percent year-on-year in the first quarter of 2025, official data showed on Wednesday, beating market expectations and marking a good start for the year amid uncertainties triggered by the United States' tariff policy.

Although the US' volatile tariffs continue to cloud the global economic outlook, officials and economists said they believe China's long-term growth trajectory will remain intact, as the country has ample room to act on macroeconomic policies and boasts favorable factors such as an ultra-large domestic market, a comprehensive industrial system and strong innovation capabilities.

Data released by the National Bureau of Statistics shows that China's value-added industrial output grew 7.7 percent year-on-year in March, accelerating from the 5.9 percent growth recorded in the first two months.

Last month, retail sales of consumer goods also rose 5.9 percent year-on-year, up from the 4 percent growth recorded during the January-February period. China's fixed-asset investment went up 4.2 percent year-on-year in the first quarter, accelerating from the 4.1 percent growth in the first two months, according to the NBS.

Sheng Laiyun, deputy head of the NBS, said that despite the headwinds triggered by the US' unwarranted imposition of tariffs, China's long-term economic growth will remain unchanged on its positive trajectory, thanks to the country's strong manufacturing base, its huge growth potential in domestic demand and the strengthening of new growth drivers, among other factors.

"We have the confidence, determination and capability to withstand external challenges and achieve the annual growth target (of around 5 percent)," he told a news conference in Beijing on Wednesday.

Louise Loo, lead economist at British think tank Oxford Economics, said, "Data shows economic activity beat estimates across the board in March and in the first quarter, supported by a continuation in stimulus momentum, sizable export front-loading and more secular strengths in high-tech manufacturing."

Robin Xing, chief China economist at Morgan Stanley, said that facing mounting downward pressures from the US' tariff hikes, China is likely to prioritize front-loading of the 2 trillion yuan ($274 billion) package in the second quarter.

"Policymakers may accelerate issuance and deployment of local construction bonds, ramp up the consumer goods trade-in program with broader coverage or more generous subsidies, and push for government purchases of housing inventory," Xing said.

The economist also said he expects new policy rollout on the monetary front.

Earlier this year, the People's Bank of China, the country's central bank, said it would lower interest rates and reserve requirement ratios at an appropriate time.

Xing said such adjustments could occur in the near term to accommodate a faster fiscal rollout.