China’s exports and imports rebound, indicating demand recovery

China's exports and imports rebound, indicating demand recovery
China's exports and imports rebound, indicating demand recovery (Image: REUTERS)
China's exports and imports rebound, indicating demand recovery
China's exports and imports rebound, indicating demand recovery (Image: REUTERS)

China’s exports and imports rebound, indicating demand recovery

China’s exports and imports rebound, indicating demand recovery

China’s exports and imports rebound, indicating demand recovery

BEIJING, May 9 (Reuters) – China’s exports and imports returned to growth in April after contracting in the previous month, customs data showed on Thursday, signalling an encouraging improvement in demand at home and overseas in a boost to a shaky economic recovery.

The data suggests a flurry of policy support measures over the past several months is gaining traction and helping to stabilise fragile investor and consumer confidence.

Shipments from China grew 1.5% year-on-year last month, in line with the increase forecast in a Reuters poll of economists. They fell 7.5% in March, which marked the first contraction since November.

Imports for April increased 8.4%, beating an expected 4.8% rise and reversing a 1.9% fall in March.

“Exports have been the bright spot in China’s economy so far this year. The weak domestic demand led to deflationary pressure, which boosts China’s export competitiveness,” said Zhang Zhiwei, chief economist at Pinpoint Asset Management.

China’s economy grew faster than expected in the first quarter, although data on exports, consumer inflation, producer prices and bank lending for March showed that momentum could be faltering again. A protracted property crisis is also showing few signs of abating, spurring calls for more policy stimulus.

In the first quarter, both imports and exports rose 1.5% year-on-year.

A string of forecast-beating economic data over the January-February period and a factory owners survey for March suggested the world’s No.2 economy had managed to successfully navigate some early challenges, buying officials more time to lift fragile investor confidence and revitalise growth.

However, Beijing has its work cut out. Rating agency Fitch cut its outlook on China’s sovereign credit rating to negative last month, citing risks to public finances as growth slows and government debt rises.

The Politburo of the Communist Party, the party’s top decision-making body, said last month it would step up support for the economy with prudent monetary policy and proactive fiscal policies, including through interest rates and bank reserve requirement ratios.
China has set an economic growth target for 2024 of around 5%, which many analysts say will be a challenge to achieve without much more stimulus.

Chinese exporters had a tough time for most of last year as soaring interest rates weighed on overseas demand. With the Federal Reserve and other developed nations showing no urgency to cut borrowing costs, manufacturers may face further strains as they battle for market share.

Analysts say Chinese exporters are continuing to slash prices to maintain sales abroad amid the weak domestic demand conditions.

“Overcapacity in many industries will continue to depress export prices in the coming months,” said Dan Wang, chief economist at Hang Seng Bank China.

“As more Chinese companies make investments overseas to get around potential sanctions from the U.S., we expect more exports of industrial inputs like chemicals, fabric, auto parts and electric machineries,” she added.

China’s trade surplus grew to $72.35 billion, compared with a forecast of $77.50 billion in the poll and $58.55 billion in March.

(Except for the headline, this story has not been edited by VoM News staff and is published from syndicated feed)

Facebook
Twitter
LinkedIn
Telegram
WhatsApp
Email
Note: You have to fill-up above all respective field, then click below button for send your message