Chinese exports last month grew at a slower pace than expected, official figures published yesterday showed, hours ahead of expected talks between Beijing and Washington aimed at easing a gruelling trade war.
Imports fell more dramatically than expected last month, with weak domestic consumption in the world’s number two economy highlighted by data earlier in the day revealing another month of falling prices.
The 4.8 percent year-on-year increase in overseas shipments last month was slower than the 8.1 percent growth recorded in April, also falling short of the six percent jump that was forecast in a survey of economists by Bloomberg.
Photo: AFP
The latest data showed a 12.7 percent plunge in exports to the US compared with April, when US President Donald Trump unveiled his eye-watering tariffs on China.
Last month’s exports to the US also represented a year-on-year decline of more than one third — the steepest slide since early 2020.
In contrast, customs data showed shipments to Vietnam increased from the previous month.
Those to other Southeast Asian countries including Malaysia, Thailand, Singapore and Indonesia all declined slightly after soaring in April, the figures indicated.
“The acceleration of exports to other economies has helped China’s exports remain relatively buoyant in the face of the trade war,” ING Bank NV chief Greater China economist Lynn Song (宋林) said, noting that shipments to Southeast Asian nations were up 14.8 percent year-on-year.
China’s overall imports last month dropped 3.4 percent year-on-year, coming up short of the 0.8 percent decline forecast by the Bloomberg survey.
Pinpoint Asset Management Ltd (保銀私募基金管理) president and chief economist Zhiwei Zhang (張智威) said the trade outlook “remains highly uncertain.”
He pointed to the impact of “frontloading,” when overseas buyers increase shipments ahead of potentially higher tariffs.
Capital Economics economist Zichun Huang (黃子春) said China’s export growth would “slow further by year-end” with tariffs “likely to remain elevated.”
The latest trade data added to concerns about the Chinese economy, with a report from the National Bureau of Statistics (NBS) showing the consumer price index — a key measure of inflation — dropped 0.1 percent year-on-year last month.
The reading, which was slightly better than expected but marks the fourth straight month of falling prices, comes as Beijing struggles to boost domestic consumption that has been sluggish since the end of the COVID-19 pandemic.
A lack of demand can then force companies to cut production, freeze hiring or lay off workers, while potentially also having to discount existing stock — dampening profitability even as costs remain the same.
Producer price deflation was worse, contracting 3.3 percent year-on-year last month, its lowest level in almost two years, after falling 2.7 percent in April.
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