Signs of economic stability as June trade expands
Print Edition
CHINA’S trade growth strengthened last month, reinforcing the belief that the world’s second-largest economy is stabilizing under a mini stimulus.
June exports grew 7.2 percent year on year to US$186.7 billion, accelerating from 7 percent in May, the General Administration of Customs said yesterday.
Imports, meanwhile, gained 5.5 percent to US$155.2 billion, reversing a dip of 1.6 percent a month earlier.
“Improving trade figures suggest China’s growth might have picked up somewhat in the second quarter due to the mini stimulus,” said Zhou Hao, an economist at Australia & New Zealand Banking Group.
“The data suggest that both external and domestic demand are on the way to recovery.”
Zhu Haibin, chief economist at China at JPMorgan, said that although June’s exports grew less than expected, the outlook for the year remains positive.
“Global demand will likely improve, and we expect exports to accelerate in the second half of the year,” he said.
China’s trade figures have fluctuated a lot this year due to different monthly comparative bases and the government’s efforts last year to combat speculative capital. Overall, trade edged up 1.2 percent in the first six months, against a full-year target of 7.5 percent.
In a bid to boost trade, the State Council in May announced a number of support measures, including more credit, speedier export tax refunds and relaxed administrative procedures. Recovering external demand and the depreciation of the yuan also helped exporters.
But uncertainty in developed markets remains, which Zhu said will put pressure on China’s efforts to bolster growth.
“The government will likely resort to fiscal, monetary and sector policies to support the economy,” he said.
“At the same time, officials will try to contain the downside risks, especially in the real estate and financial markets.”
The government introduced a targeted mini stimulus program in March to sustain growth and create jobs. The measures, such as increased investment in railways, and reducing the reserve requirement and adjusting the loan-to-deposit ratio for banks to give them more lending power, have played a key part in stabilizing the economy.
According to Customs, though the country’s trade surplus narrowed slightly in June to US$31.5 billion — from US$35.9 billion in May — it remained far above the US$18.5 billion reported for April.
ANZ’s Zhou said the size of the surplus will keep the pressure on the yuan to appreciate.
“The large trade surplus has again put the yuan in the spotlight at the China-US Strategic and Economic Dialogue,” he said, adding that the currency is likely to appreciate to 6.15 to the US dollar by the end of the year from the current spot rate of 6.20.
Finance Minister Lou Jiwei said on Wednesday that given an unsteady economy and abnormal capital inflows it was hard to take a hands-off approach when it came to the yuan.
That said, net foreign exchange purchases by the central bank and commercial lenders have declined sharply in the past few months, indicating less intervention in the market.
China’s trade with the European Union in the first half gained 9.6 percent, with figures for the UK and Germany up 19.7 and 10.2 percent respectively. Trade increased 2.8 percent with the United States in the period and rose 1.3 percent with Japan.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
