China's exports record biggest decline in more than 3 years
The dollar value of China exports are expected to decline 9.5% in June from a year earlier, according to a Reuters poll, deepening a 7.5% annual decline in May.
China's exports contracted in June at the fastest pace since the start of the Covid-19 pandemic, as high inflation in key developed markets and geopolitics hit global demand.
Thursday's trade data release is yet another indication that China's leaders will not be able to entirely count on external factors in reviving the faltering growth momentum in the world's second-largest economy. The decline in June imports was also more severe than expected, suggesting local demand is waning.
"Latest data in the developed countries show consistent signals of further weakness which will likely put more pressure on China's exports in the rest of the year," said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.
"China has to depend on domestic demand," he added. "The big question in the next few months is whether domestic demand can rebound without much stimulus from the government."
The dollar value of China's exports plunged 12.4% in June from a year ago, customs data showed Thursday. This is a far bigger drop than expectations for a 9.5% decline in a Reuters poll and the 7.5% annual decline in May. The percentage decline was the biggest that the world's second-largest economy has recorded since February 2020.
Imports declined 6.8%, in June from a year ago, also worse than expectations for a 4% decline and the 4.5% annual decline in May.
China's trade still faces rather great pressure in the second half of the year, partly due to high inflation in developed countries and geopolitics, Lu Daliang, a spokesperson for China's customs bureau, said at a press conference Thursday.
Source: CNBC
