September 8, 2022
China’s export growth slowed in August as rising inflation hampered overseas demand and new Covid curbs and heatwaves disrupted production, reviving the economy’s downside risks.
Exports increased 7.1% year on year in August, slowing from an 18.0% increase in July, according to official customs data released. The reading fell short of analysts’ expectations of a 12.8% increase.
In 2022, exports did better than other economic drivers, but as global demand declines, difficulties have grown.
In addition to unfavorable comparisons to the country’s robust export performance last year, China’s slowing growth has been made worse by more Covid restrictions as infections increased and heatwaves interrupted factory operations in the southwest.
According to customs figures, imports once again increased slowly in August, climbing just 0.3% from the previous month’s 2.3%, significantly below the expected 1.1% increase.
Imports were severely hampered by the weak domestic demand, which was further hampered by the worst heatwaves in decades, a housing crisis, and lax consumption.
The decline in world commodity prices persisted in August, albeit more slowly.
As a result, the trade surplus shrank to $79.39 billion from $101.26 billion in July, which was a record-breaking month for the goods trade balance of any nation ever.
In an effort to stop the recent devaluation of the yuan, the central bank announced on Monday that it will reduce the amount of foreign exchange reserves that financial institutions must hold.
Source: CNBC
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.
