Wednesday, July 24, 2024
Home Stock Analysis China exports grow steadily, but slowing imports dampen outlook Reuters

China exports grow steadily, but slowing imports dampen outlook Reuters

by xyonent
0 comment

Joe Cash

BEIJING (Reuters) – China’s exports grew sharply for a second straight month in May, suggesting factory owners were having success finding buyers overseas, providing some relief to an economy striving for a sustained recovery.

But the jury is still out on whether export sales are sustainable as the property crisis drags on and domestic demand continues to weaken, a factor highlighted again in last month’s import figures.

Export cargo volumes from the world’s second-largest economy rose 7.6% in May from a year earlier, customs data showed.

However, imports grew 1.8 percent slower than the previous month’s 8.4 percent increase, highlighting the vulnerability of domestic consumption.

Exports rose faster than the 6.0 percent increase forecast in a Reuters poll of economists and the 1.5 percent increase in April, but this was also likely due to a lower base for comparison after rising interest rates and inflation in the United States and Europe weighed on external demand last year.

Friday’s shipping data could also suggest that a global cyclical recovery in the electronics sector is boosting sales of components and finished goods in China.

A wave of data in recent months has suggested different parts of the $18.6 trillion economy are recovering at different rates, raising uncertainty about the outlook.

First-quarter growth was much stronger than expected and strong export and production data in March suggested improving global demand could help authorities’ efforts to stabilise the economy, but recent indications of weak domestic consumption have put a damper on earlier optimism.

The prolonged crisis in the property sector is the biggest drag on China’s economy, with dwindling investor and consumer confidence weighing on domestic consumption and weakening business activity.

Adding further concern to policymakers, a May survey of factory owners conducted by the National Bureau of Statistics showed that sub-indices for new orders and new export orders were shrinking again after two consecutive months of increases.

But Friday’s trade data should give officials some breathing room as they continue their efforts to spur a broad economic recovery.

The International Monetary Fund last month raised its growth forecast for China for 2024 in line with Beijing’s growth target of “about” 5 percent, but warned of risks to the economy from the property problem.

China’s trade surplus rose to $82.62 billion last month, compared with April estimates of $73 billion and $72.35 billion.

(This article has been refiled to fix a typo in the fourth paragraph)

You may also like

Leave a Comment

About Us

Investxyon

At InvestXyon, we empower individuals with knowledge for informed investing, financial navigation, and secure futures. Our trusted platform covers investments, stocks, personal finance, retirement, and more.

Feature Posts

Newsletter

Subscribe my Newsletter for new blog posts, tips & new photos. Let's stay updated!