Data released by the General Administration of Customs showed that China's exports increased more than expected in June, but imports unexpectedly declined, bringing the trade surplus to its highest level since July 2022.
According to the report, exports rose by 8.6% per annum after an increase of 7.6% per annum in May. Economists had expected exports to grow by 8% per annum. Imports fell by 2.3% per annum, offsetting the May increase (+1.8% per annum). Consensus estimates suggested an increase in imports by 2.8% per annum. As a result, the trade surplus rose to $99.05 billion from $82.62 billion in May. This was well above economists' forecast of $85.0 billion. The US has repeatedly highlighted the surplus as evidence of one-sided trade favoring the Chinese economy.
Experts said that the higher-than-expected export volume was one of the few positive things for the economy, which is still struggling for momentum. However, as more countries consider tightening restrictions on Chinese goods, pressure on exports is also increasing. In May, the United States increased duties on a number of Chinese imports, including four times, up to 100%, on Chinese electric vehicles. Brussels confirmed last week that it would also impose duties on electric vehicles, but only up to 37.6%.
Analysts expect China to take additional support measures in the short term, and the government's promise to strengthen fiscal stimulus is expected to help boost domestic consumption.