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China's economic growth accelerated to 5 percent in the first quarter of 2026 despite mounting external uncertainties, underscoring that the resilience of the world's second-largest economy is underpinned by its vast domestic market, officials and experts said on Thursday.

Domestic demand contributed more than four-fifths of GDP growth, they said, with investment returning to positive growth and inflation picking up — a trend expected to anchor steady economic expansion in the coming months.

However, analysts cautioned that the recovery in domestic demand may not yet be on firm footing, given the slowdown in household income growth and continued pressures from elevated international energy costs, highlighting the need for ramping up targeted policy support.

China's GDP came in at 33.42 trillion yuan ($4.9 trillion) in the first quarter, growing 5 percent year-on-year in real terms and 0.5 percentage point faster than the fourth quarter of 2025, the National Bureau of Statistics said on Thursday.

"The Chinese economy got off to a good start, with main macroeconomic indicators improving and new growth drivers expanding rapidly," said Mao Shengyong, deputy head of the NBS, adding that the economy is well-positioned to maintain steady growth in the coming period.

Beating market expectations, first-quarter growth was supported by improving domestic demand and resilient export growth. Retail sales, a key gauge of consumption, grew 2.4 percent year-on-year, up 0.7 percentage point from the previous quarter, the NBS said.

Fixed-asset investment rose 1.7 percent year-on-year during the first quarter, reversing a 3.8 percent decline in 2025, as infrastructure spending strengthened and manufacturing investment accelerated, while the contraction in property development investment narrowed.

In total, consumption and investment accounted for 84.7 percent of first-quarter GDP growth, up nearly 30 percentage points year-on-year, the bureau said, pointing to a continued shift toward a growth model driven by domestic demand.

Technological and industrial innovation also provided strong support. High-tech manufacturing contributed 32.6 percent of overall industrial output growth, which is up 6.1 percent year-on-year, 1.1 percentage points faster than in the