China’s industrial profits rose for a second straight month in April, official data showed Tuesday, despite prohibitive U.S. tariffs and persistent deflationary pressures.

Cumulative profits at major industrial firms climbed 3% in April after returning to growth in the first quarter of this year, rising 0.8% from a year earlier, reversing the trend of declines since the third quarter of last year.

In the first four months this year, industrial profits rose 1.4%, year on year, the data showed.

U.S. President Donald Trump slapped eye-watering tariffs of 145% on imports from China last month, drawing Beijing to retaliate, effectively amounting to a mutual trade embargo between the world’s two largest economies.

Both sides agreed to lower most of those levies earlier this month, following a trade truce struck during a meeting between the Trump administration and Chinese leadership in Geneva, Switzerland.

U.S. tariffs on goods imported from China have fallen to 51.1% while China’s levies on U.S. imports stand at 32.6%, according to think tank Peterson Institute for International Economics.

China’s manufacturing activity fell more than expected to a 16-month low in April, with the official purchasing managers’ index coming in at 49.0, sliding into contractionary territory for the first time this year.

Retail sales growth slowed to 5.1% from a year earlier while industrial output expanded 6.1% on year, underscoring the persisting supply-demand imbalance in the economy.

Exports to the U.S. plunged over 21% from a year earlier as the triple-digit tariffs kicked in, while overall exports surged 8.1% on the back of a jump in shipments to Southeast Asian nations.

This is breaking news. Please refresh for updates.