China’s exports record bigger slump than expected in October

CHINA’S export slump unexpectedly deepened in October, underscoring the fragility of an economic recovery that has been trying to stabilise.

Overseas shipments fell 6.4 per cent from a year ago, worse than the 3.5 per cent decline forecast by economists in a Bloomberg survey. Imports surprisingly expanded 3 per cent, in contrast with the expectation of a 5 per cent decline. The resulting trade surplus was US$56.53 billion.

The data for October is distorted somewhat by a favourable base of comparison with 2022, when the pandemic and controls to contain it disrupted logistics and production. That was expected to help last month’s figures, though a decline in exports had already been easing in a sign of improving global demand for Chinese goods.

Investors are assessing the sustainability of the recovery for China’s economy. While figures in recent months have shown improvement, the recovery remains fragile amid low consumer and business confidence. Economic data for October pointed to weakness in the manufacturing and services sectors. Consumer prices likely slid back into deflation last month, official statistics are likely to show this week.

There are signs of improving global trade elsewhere. South Korea’s exports – which are seen as a bellwether for global demand and Asia exports – rose for the first time since late last year in October. That has fuelled hopes for an improvement in tech industries such as semiconductors. BLOOMBERG