China's trade growth rebounds in May
- Author: Zachary Reyes Jun 08, 2017,
Jun 08, 2017, 15:23
Imports increased 14.8 per cent, leaving a trade surplus of US$40.81 billion (S$56.42 billion). Prior to the release of the official data, the analysts were expecting China's trade surplus to have widened to $46.32 billion in May, from April's $38.05 billion.
China's exports and imports surged in May, beating expectations, customs data showed Thursday.
China's latest trade data report provides some comfort for President Donald's Trump ambition to slash America's trade deficit with its biggest economic rival, but nonetheless shows how hard that will be - even with a more competitive greenback.
"Export growth is also likely to edge down but should fare better than imports given the relatively upbeat outlook for China's main trading partners".
That raises hopes that exports may buffer the economy from a slowdown, as efforts at deleveraging and controls on real estate hit domestic demand, according to Tom.
But growth in both exports and imports defied those expectations and accelerated from April.
Sources at two steel mills told Reuters they expect output to remain high as profit margins and demand are still strong, even though construction activity in China tends to ease in summer due to intense heat and rain in parts of the county. This reflects a combination of higher commodity prices along with increased demand.
But investors have been more focused on its strong appetite for imports, particularly for industrial commodities such as iron ore and coal which is boosting resources prices worldwide.
Import volumes rebounded from a 4.5% pace in April to 8.5% last month, the same economist said.
Exports benefitted from solid demand from Europe and the United States, though trade has been under a cloud since Donald Trump was elected president in November vowing to shrink the large US trade deficit with China.
The two largest economies of the world, China and USA have commenced their 100 days of trade discussion, agreed between the Presidents Xi and Trump during their discussions in Florida in April with the focus to reduce the huge U.S. trade deficit with China.
That's the highest rate since November and comes despite a 27.1% surge in USA made imports. However, more than half of the surplus - $22 billion - was registered with the United States.
As a sign of progress, both countries agreed to take measures by middle of July for increasing the access of United States financial companies and augmenting trade in chicken and beef, among others.