A U.S. cargo ship is seen at Yangshan Deep-Water Port, an automated cargo wharf, in Shanghai on April 9, 2018.
Johannes Eisele | AFP | Getty Images
China’s exports grew at the fastest pace in 19 months in October, while imports also rose, official data showed on Saturday as the world’s second largest economy continued to recover after being badly hit by the coronavirus crisis earlier this year .
Exports rose 11.4% yoy in October, beating analysts’ expectations of a 9.3% increase and accelerating from a solid 9.9% increase in September.
The surge in exports raised the October trade surplus to $ 58.44 billion, compared with the survey’s forecast of a surplus of $ 46 billion and a surplus of $ 37 billion in September.
China’s trade surplus with the United States rose from $ 30.75 billion in September to $ 31.37 billion in October.
China’s exports have largely remained stable in the face of the global Covid-19 pandemic, as strong demand for medical supplies and reduced manufacturing capacity elsewhere worked in China’s favor.
“Export growth has continued to accelerate and significantly exceeded expectations, indicating relatively strong momentum,” said Liu Xuezhi, an analyst at the Bank of Communications in Shanghai.
China’s exports could remain strong through the remainder of 2020 as domestic companies resume production faster than global competitors and sell more Covid-19-related goods like face masks, Liu said.
However, some analysts said exports could come under pressure in the coming months as major European economies, including France, Germany and the UK, stalled again as a second wave of coronavirus cases gained strength.
Factory activity accelerated at the fastest pace in nearly a decade in October, according to a private survey, although the official survey indicated some slowdown in expansion. Export orders expanded.
Imports rose 4.7% yoy in October, slower than the 13.2% growth in September, and fell short of expectations for a 9.5% increase in a Reuters poll, but they still do represents a second consecutive month of growth.
Chinese airlines are avoiding some Airbus aircraft deliveries, citing coronavirus fears for their employees in the recent dispute over efforts to keep late deliveries on track despite the pandemic.
Analysts said solid trade performance could fuel China’s general economic recovery, which has picked up pace after a deep slump earlier this year.
China’s economy grew 4.9% year over year in the third quarter, but growth could slow to just over 2% this year – the weakest in over three decades, but still much stronger than other large economies.
“China has a better pandemic recovery and comparative advantage so it has won a larger market,” said Zhou Hao, an economist at Commerzbank in Singapore.
“Of course, this benefit is only temporary and can last until the end of the year.”