China exports see unexpected spike in July, imports down
August 7, 2020 12:51 PM
China saw another surprise jump in exports last month as the global economy slowly reopened after virus lockdowns, data showed Friday, but there were warnings that while the country is expected to get back on track by year's end, overseas shipments would likely struggle.
The readings, however, showed an unexpected fall in imports, highlighting the battle leaders have in stoking domestic demand as a key driver of national growth.
Exports rose 7.2 percent in July, customs data showed, smashing forecasts in a Bloomberg survey for a 0.7 percent drop. The figure was also a massive jump from the 0.5 percent increase in June, which also beat expectations.
Analysts had warned that a spike in global infections -- forcing new containment measures in some countries -- and weakened external demand could weigh on China's recovery, with the boost from healthcare shipments fading.
Imports fell 1.4 percent, confounding a 0.9 percent rise tipped by analysts.
China's economy contracted 6.8 percent in the first quarter as lockdowns around the country to prevent the virus spreading brought businesses and activity to a near standstill.
But success in containing the disease domestically and the easing of measures helped it rebound rapidly in the following three months, and Capital Economics said in a recent report that the country is "on course to return to its pre-virus path" by year-end.
However, it warned "exports are likely to remain below their pre-virus peak for the remainder of the year, given the drawn-out recovery facing the rest of the world".
Meanwhile, China's trade surplus with the United States was $32.456 billion in July -- up 16 percent from $27.974 billion a year ago during the bruising trade war.