China’s trade growth slows as commodity demand moderates
Print Edition
CHINA’S foreign trade growth slowed more than expected in April amid weaker demand and a correction in commodity prices.
Exports in yuan-denominated terms rose 14.3 percent year on year to 1.24 trillion yuan (US$180 billion), slower than the 22.3 percent increase in March, the General Administration of Customs said.
Imports grew 18.6 percent to 979.1 billion yuan, compared with the 26.3 percent gain in March
In US dollar terms, exports rose 8 percent, missing market expectations of 11.3 percent, while imports grew 11.9 percent, compared with consensus for 18 percent.
The slower growth in trade was attributed by analysts to a correction in commodity prices.
“China’s export growth in April was half the pace in March, indicating a softening momentum in the second quarter,” the Australia and New Zealand Banking Group said in a note yesterday.
The slowing growth in imports in April echoed the softening commodity price rise last month. China’s import outlook is likely to be weighed by commodity prices, the country’s rising iron ore inventory and credit tightening.
China’s imports of crude oil, iron ore and copper all fell compared with March, with the data in line with a recent survey of purchasing managers in the manufacturing sector showing April expansion was the slowest in six months.
Despite the slowdown, imports year-to-date are still up 20.8 percent by value, compared with 8.1 percent growth for exports over the first four months, though analysts say imports could slow further this year.
“Looking ahead, we expect export growth to hold up well given the relatively bright outlook for the global economy this year,” Capital Economics China economist Julian Evans-Pritchard said in a note. “Growth in inbound shipments will continue to face headwinds, however. In particular, policy tightening will further weigh on domestic demand in coming quarters.”
China’s trade with the European Union, its largest trading partner, gained 15.5 percent year on year to 1.24 trillion yuan during the first four months.
Trade with the United States, its second-biggest trade partner, surged 20.3 percent to 1.18 trillion yuan in the same period.
China’s imports and exports are expected to stabilize and improve in the near future, the Ministry of Commerce said last week in its quarterly report on trends in the country’s foreign trade.
Foreign trade is set to face a better environment in 2017 compared with the past two years, the report said.
Concerns, however, have been raised that China’s pace of economic growth may have peaked amid the weaker-than-expected trade data as well as slower expansion in manufacturing and services sectors.
China’s official manufacturing PMI fell below market estimates to 51.2 in April and the official non-manufacturing PMI was 52.6 in April, 1.6 points below March’s, according to earlier data.
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