China’s trade beats market hopes on strong demand
CHINA’S foreign trade accelerated more than market expectations in May, supported by external and domestic demand.
Exports in yuan-denominated terms rose 15.5 percent year on year in May to 1.32 trillion yuan (US$194 billion), faster than April’s 14.3 percent, data with the General Administration of Customs showed yesterday.
Imports growth surged 22.1 percent from April’s 18.6 percent.
China’s monthly trade surplus widened from April’s 281.6 billion yuan but was 3.4 percent lower than May last year.
The picture was also rosy in US dollar-denominated terms, with exports growing 8.7 percent and imports accelerating 14.8 percent.
Both readings beat expectations for 7 percent and 8.5 percent according to a Reuters poll.
Analysts attributed the growth in trade to resilient global demand and solid domestic investment.
“The continued uptick in Chinese exports points to the resilience of global demand, especially that of developed economies, most importantly the EU,” Wang Tao, chief China economist of UBS, wrote in a note yesterday.
“The surprising strength of imports suggests that China’s domestic demand, especially investment, remains solid despite recent signs of that activity was peaking.”
But the Australia and New Zealand Banking Group pointed out that the trend of a stronger yuan and volatility in commodity prices may complicate China’s import outlook in the near term.
Still the growth of trade in May continued its recovery starting at the beginning of the year.
Customs data showed that in the first five months combined, exports added 14.8 percent from a year ago and imports jumped 26.5 percent.
The gains reversed a 1.8 percent year-on-year decline in exports and 3 percent fall in imports during the same period last year.
From January to May, trade with the European Union, China’s largest trading partner, jumped 16.1 percent from the same period last year to 1.6 trillion yuan, Customs said.
Trade with the United States, the 10-member Association of Southeast Asians and Japan surged 21.1 percent, 23.2 percent and 17.5 percent, respectively.
Seven labor-intensive sectors, including textiles, furniture and plastics products, propelled China’s exports, rising 12.8 percent to contribute 20.8 percent of China’s total exports, Customs said.