China’s exports soar past forecast as factories front-run Trump tariff threat

0

TRUMP EFFECT

China’s exports to the US increased an annual 8.1 per cent last month, while outbound shipments to Europe jumped 12.7 per cent over the same period.

“We expect shipments to stay strong in the coming months,” Zichun Huang, China economist at Capital Economics, said in a note. “Any potential drag from Trump tariffs may not materialise until the second half of next year.”

“Trump’s return could create a short-term boost to Chinese exports as US importers increase their purchases to get ahead of the tariffs,” she added.

Among China’s top exports to the US last year were smartphones, tablet computers and video games consoles, Chinese customs data shows, setting up a potential repeat of Trumps’s first term in office when he targeted Chinese electronics manufacturers.

There are signs demand for such products is dimming.

Trade data from South Korea and Taiwan pointed to cooling global demand, while German manufacturers have also reported they are struggling to find buyers overseas, leading analysts to conclude Chinese producers are slashing prices to find buyers or simply moving stocks out of China.

An official factory activity survey for October showed Chinese factories were still struggling to find buyers overseas.

“If the PMI new export sub-index has been going down, and the export figure goes up, I think it is safe to say it’s more of an inventory shift,” said Dan Wang, a Chinese economist based in Shanghai.

Exporters also had help from an easing in weather-related disruptions in September, enabling them to send out delayed orders.

China and Hong Kong stocks edged up on Thursday, supported by investor optimism over potential further stimulus measures, while the yuan recovered from a three-month low against the dollar.

The weaker yuan likely contributed to the surge in exports, analysts say, though it also made imports more

Read the rest of the article here.

LEAVE A REPLY

Please enter your comment!
Please enter your name here