A foreign trade container ship leaves the dock at Qingdao Port in Qingdao, China, June 7, 2024.
Cost photo | Photo only | Getty Images
China's exports and imports both fell short of expectations in November, data from the country's customs agency showed on Tuesday, fueling concerns about the health of China's economy as consumer demand remains sluggish and tariff threats loom.
Import data surprised with a 3.9% decline, the largest decline since September 2023. Analysts had expected imports to rise 0.3%.
Exports rose 6.7% year-over-year in U.S. dollar terms, well below the 12.7% growth in the previous month. Analysts had expected exports to rise 8.5% from a year earlier in a Reuters poll in November.
The slowdown in November exports “does not mark the end of China's recent export boom,” Zichun Huang, China economist at Capital Economics, said in a note on Tuesday, adding that while U.S. tariffs could reduce export volumes by around 3% “Maybe but also.” will only become noticeable in the middle of next year.”
In the short term, the tariff threats “may even boost exports as U.S. firms increase their orders for Chinese goods,” Huang added.
Meanwhile, import volumes could also recover in the near term as accelerated government spending boosts demand for manufactured goods, Huang said.
China's exports to all major trading partners – the United States, the European Union and the Association of Southeast Asian Nations – rose in November compared to a year ago.
According to CNBC's analysis of official data, exports to ASEAN countries increased the most, by almost 15%. Imports from its largest trading partner, ASEAN, fell 3%.
China's exports to the US rose 8% year-on-year, while imports fell over 11%. The country's exports to the European Union rose 7.2%, while imports fell 6.5% year-on-year.
China's exports to Russia fell 2.5%, while imports fell 6.5%.
The volume of China's rare earth exports rose nearly 5% in November from a year earlier, shipping 4,416 tons of the minerals used in products from electric vehicles to consumer electronics. Cumulative exports rose 6.6% year-on-year in the months to November this year.
The country's rare earth imports fell by over 20% to 11,327 tonnes compared to the previous year.
The country announced a new policy in July to strengthen its oversight of the domestic rare earths industry on national security grounds.
China's steel exports rose 16% year-on-year to 9.28 million tonnes last month. The country's steel exports have surged this year and are expected to exceed 100 million tonnes, the same level as last year 2016.
Bumpy recovery
Exports were a rare bright spot for the world's second-largest economy, which has been plagued by weak domestic consumption and a prolonged downturn in the real estate market.
Exports in U.S. dollar terms rose 5.4% year-to-date to $3.24 trillion, while imports rose 1.2% year-on-year to $2.36 trillion, according to customs data released Tuesday .
The November trade data came a day after China's top leadership pledged to step up monetary and fiscal stimulus to boost growth next year and pledged “unconventional countercyclical adjustments” to boost domestic consumer demand.
Export growth could continue to pick up through early 2025 as U.S. importers continue to “push” Chinese purchases, said Erica Tay, director of macro research at Maybank, pointing out that there could be “a decline in the second half of the year.” next year as US tariffs bite.
Manufacturing activity in the country increased for a second straight month in November, with the official purchasing managers' index rising to 50.3, as Beijing's existing stimulus measures helped boost certain aspects of the struggling economy.
However, domestic demand remained weak. Official data on Monday showed that consumer inflation in China fell to its lowest level in five months in November, rising 0.2% from a year earlier.
Comments are closed.