China’s May exports hold up, imports surge on robust demand

June 7, 2018 - Chinese imports surged while export growth held up, suggesting both domestic and international demand continue to shrug off the uncertainty of trade frictions with the U.S.

Exports rose 12.6 percent in May, the customs administration said Friday, faster than a forecast of 11.1 percent. Imports surged 26 percent, leaving a trade surplus $24.9 billion.

The largest exporting nation continues to benefit from global demand, with the cycle of threats and talks between the U.S. and China failing to damp company confidence. The U.S. and China continue to haggle over the shape of a deal, with China warning that none of its previous commitments will happen if President Donald Trump carries out his threat to impose tariffs or any other trade curbs.

“The particularly strong May figures are due to uncertainties from the trade negotiations,” said Iris Pang, an economist at ING Groep NV in Hong Kong and the only accurate forecaster of May import growth in a Bloomberg survey. “Exports risks are mounting, so the exporters expedited importing components for re-export.”

U.S. data show the goods trade deficit with China rose to a record $375 billion last year. Including services, in which the U.S. runs a surplus with the Asian nation, its total deficit was smaller.

“The trading figures in the months ahead will hinge crucially on the playout of the Sino-US trade frictions and the performance of domestic consumption,” Radhika Rao, an economist at DBS Bank Ltd in Singapore wrote in a note this week.

Source: American Journal of Transportation