China’s exports posted a surprise growth in November, which was largely due to the low base of comparison, while imports dropped unexpectedly suggesting that overall trade remains sluggish.
Data released by the Customs Office showed that exports increased 0.5 percent from a year ago in November, confounding expectations for a decline of 1.1 percent.
This followed a sharp 6.4 percent decrease in October. Moreover, the increase was the first in seven months.
On the other hand, imports registered a 0.6 percent decline, in contrast to the 3.3 percent growth forecast. In October, imports had increased 3.0 percent.
Consequently, the trade surplus rose to around $68.4 billion from $56.5 billion a month ago. The surplus was forecast to rise to $58 billion.
Exports to the US advanced more than 7.0 percent but shipments to the EU decreased 14.5 percent.
Capital Economics economists said the recent strength in exports was driven by exporters slashing prices to gain market share, which is not sustainable.
Without the support of price cuts, exports are unlikely to defy the slowdown in economic growth among major trading partners, they noted.
However, imports are likely to hold up better in the near term, economists observed.
Earlier this week, Moody’s downgraded China’s sovereign rating outlook to ‘negative’ from ‘stable’ and retained its credit ratings.
The agency assessed that fiscal support measures amid property market downturn poses downside risks to fiscal health.
On Thursday, S&P Global reportedly maintained the credit rating of China at A+ with stable outlook.
In another report, S&P Global warned that the slump in China could spread to other regions given the country’s large proportion of global trade.
The rating agency projected China’s GDP growth to slow to 4.6 percent in 2024 from an estimated 5.4 percent this year.
Growth is forecast to rise to 4.8 percent in 2025 and return to 4.6 percent in 2026.
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