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China’s imports recorded a surprising increase in December; Exports beat expectations due to fears of higher tariffs


Aerial view of a container ship leaving the dock in Chengdu, in eastern China’s Shandong province.

Future Publications Future Publications getty images

China’s trade data in December beat expectations by a wide margin, as exporters continued to push back shipments amid concerns about additional tariff increases, while the country’s stimulus measures appear to be supporting demand in the industrial sector.

Exports in December rose 10.7% in US dollar terms compared with a year earlier, according to China data Customs authority showed on MondayBeating expectations for a 7.3% rise in a Reuters poll. This compares with a 6.7% increase in November and a 12.7% increase in October.

Customs data showed imports last month rose 1.0% from a year earlier, contrasting with contraction in the previous two months. Analysts had estimated imports to decline 1.5% year on year. It is compared to a Big fall of 3.9% in November And 2.3% in October,

Last year, China’s total yuan-denominated exports increased by 7.1% from the previous year, accelerating. Marginal growth of 0.6% in 2023Customs officials said at a press conference on Monday.

China’s imports increased by 2.3% last year, which is increasing from last year. 0.3% decline in 2023,

“Outbound shipments are likely to remain resilient in the near term, supported by further gains in global market share,” Zichuan Huang, China economist at Capital Economics, said in a note. Thanks for the weak yuan.

However, the export outlook for the full year appears less optimistic, as “potential tariff hikes could dampen the momentum,” said Bruce Pang, distinguished senior research fellow at the National Institution for Finance and Development.

“In the short term, with the pickup in fiscal spending, import volumes are also expected to surge further due to strong demand for industrial goods,” Pang said.

China’s domestic demand has been hit by a prolonged real estate crisis, making the country more dependent on exports to power its growth.

Economists expect exports Significantly aided China’s economic growth Last year. The country’s full year GDP data is due later this week.

Exports have been a rare bright spot in China’s battered economy amid rising trade tensions with its major trading partners – the US, the EU – but that growth could be in jeopardy after US President-elect Donald Trump returns to the White House. Is.

Gary Ng, senior economist at Natixis, told CNBC in an email that China will need to focus more on boosting domestic demand this year as external momentum is slowing. “China’s deflationary pressure on the manufacturing sector could fuel further geopolitical tensions,” he said.

The recovery in domestic demand is slowing due to weak consumer sentiment, uneven real estate recovery and slow growth in local government infrastructure projects, Ng said.

In December, shipments increased to most markets, with double-digit increases in the Association of Southeast Asian Nations and the US, where exports rose 18.9% and 15.6%, respectively, from a year earlier, according to CNBC’s calculations of official customs data. . ,

Imports from the US rose 2.6% in December and those from ASEAN – China’s biggest trading partner – rose 5.4%.

Exports to the EU increased by 8.76% while imports fell by 4.9%. The country’s exports to BRICS partner Russia rose 5.5% while imports declined 4.7%.

Last year, China’s exports of electric vehicles and semiconductors an increase of 13.1% and 18.7% respectively over the previous yearAccording to customs officials.

Meanwhile, the country’s steel exports hit the highest level since 2015, with shipments reaching 110.7 million tonnes, as the country attempted to meet weak domestic demand due to an asset crisis and a slowdown in manufacturing activity.

‘A Relic of Caution’

Trump – who is due to take office on January 20 – has raised fears about higher tariffs on Chinese exports. he has Promised additional 10% tariff on all Chinese goods entering the US

Chinese authorities have stepped up policy support since late September to shore up the country’s economy as growth rates decline and social tensions rise. But Teneo’s managing director Gabriel Wildau said in a note last Friday that “a balance of caution and restraint still remains.”

China has policy rate cutLoose property purchase restrictionsAlso infused liquidity into the financial market Unveiled a debt-swap program To reduce the financial stress of local governments.

Wildau said, “Although top leaders recognize the need to boost real GDP growth, Xi still appears reluctant to embrace the additional stimulus needed to tackle deflation.”

“If the tariff impact is severe then policymakers need to keep some stimulus powder dry to adequately respond,” he said, suggesting that uncertainty about export growth would lead Beijing to avoid a “big bang approach.” Creates an additional reason for.

China's fiscal stimulus and fiscal deficit are the focus for investors, not boosting short-term demand

Among the key economic data this week, China is set to release its full-year as well as fourth-quarter gross domestic product data on Friday. According to a Reuters poll, growth is pegged at 5.1% year on year in the last quarter of 2024.

For this year, the top leadership resolved to promote Domestic consumption top priority While expanding fiscal expenditure to fund consumer goods trade-in and equipment upgrade policy. Was launched in July last yearTrade-in program subsidizes consumers Swap old cars or home appliances And buy new ones at a discount.



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