Sunday, September 8, 2013
DJ: China's Exports Improve In August; Trade Surplus Widens
BEIJING--China's exports continued to gather steam in August reflecting improving external demand and revealing more signs the world's second-largest economy is stabilizing.
But imports--while improving from a year ago--were slightly less impressive and that helped produce a wider-than-expected trade surplus of $28.6 billion during the month.
"China's back," said Stephen Green of Standard Chartered Bank. "It won't be a strong recovery but it's increasingly clear we've bottomed."
Exports rose 7.2% on year in August, data from the General Administration of Customs showed on Sunday. This was up from July's 5.1% on year rise after a 3.1% fall in June and beat the median forecast of economists polled by Dow Jones Newswires for a 6.0% expansion.
Imports advanced 7.0% on year, down from the 10.9% rise in July, but still showing a sharp turnaround from June's 0.7% fall. The import tally missed the median forecast of economists for an 11.7% increase, however.
China's economy showed less robust growth over the first half of the year hit by a still sluggish global economy and weak domestic demand. Economic growth slipped to 7.5% on year in the second quarter after a 7.7% increase in the first quarter.
But more recent data have shown a stabilizing, if not a robust, upturn. The latest reading of the official Manufacturing Purchasing Managers' Index for August was strong--revealing better conditions at the nation's factories.
Government officials are slightly more confident economic growth will reach the 7.5% target for the year while combined imports and exports will expand by the target of 8%.
In August exports to the European Union still showed sluggishness, falling 2% year over year, but exports to the U.S. advanced 6%. Exports to Hong Kong--a big transshipment center--were also up 6% on year and there was good news from some emerging markets. Exports to Brazil gained 14%.
"External demand is better than expected," HSBC economist Ma Xiaoping said.
"Over the coming months we should see a stronger upturn in exports. The U.S. data--like employment and retail sales--are improving. The fundamentals there are getting a bit better," she said.
Domestic demand is a bit less positive than anticipated though she said there should be a modest recovery in imports in the coming months.
Iron-ore imports in August were up 10.5% on year while copper imports were up 8.9%--though both figures were down from very strong levels of July.
The trade balance in August was up from $17.8 billion in July and surpassed a median forecast by economists of $20.4 billion.