Chinese Economy Surprises With Rebound But War Risks Loom (1)

China’s economy rebounded in early 2026 with a surprising uptick in domestic consumption and investment, an acceleration that may prove hard to sustain if the war in Iran stalls exports.

Factories revved up production as shipments overseas surged at the start of this year. Industrial output climbed 6.3% in January-February from a year earlier, according to data released by the National Bureau of Statistics on Monday, the fastest growth since September.

Other segments of the economy that are more reliant on domestic demand also got off to a stronger start than expected. Retail sales rose 2.8% in the first two ...