China’s economy back on track as August exports accelerate
Reuters in Beijing
The mainland's exports rose more than expected last month, boosted by improving demand for its goods in major markets and adding to evidence that the world's second-largest economy may have avoided a sharp slowdown.
The Customs Administration said yesterday exports rose 7.2 per cent year on year and imports increased 7 per cent, leaving the country with a trade surplus of US$28.6 billion for the month.
Analysts had expected a 6 per cent rise in exports, an 11.3 per cent increase in imports and a trade surplus of US$20 billion.
"China's August trade sustained the upward trend seen since July, in line with accelerating growth momentum and improving market sentiment, pointing to an upside bias in [third-quarter gross domestic product] growth," ANZ economists Liu Ligang and Zhou Hao said in a note after the data was released.
After slowing in nine of the past 10 quarters, the economy has shown signs of stabilisation, with surveys last week showing manufacturing regaining momentum and growth in the services sector at a five-month high.
Investors had as recently as a month ago worried that the economy was slipping into a deeper-than-expected downturn, especially after the mainland's money market suffered an unprecedented cash crunch in June. But policymakers have stepped in with measures to steady the economy, from quicker railway investment and public housing construction to introducing policies to help smaller companies with financing needs.
Attention now turns to the release this week of other data for last month, with investors looking to figures for industrial output, inflation, money supply and investment to further gauge the impact of those measures.
Yesterday's trade figures showed exports of electronics, textiles and machinery rose.
Exports to members of the Association of Southeast Asian Nations jumped 30.8 per cent, while those to the United States climbed 6.1 per cent. Exports to the European Union grew 2.5 per cent, while exports to Japan contracted for the seventh straight month.
The figures should help Beijing's push to restructure the economy away from a dependence on credit, investment and exports for growth and towards one driven by consumers.