China Exports Log Unexpected Growth; Imports Fall

China exports posted a surprise growth in March, while imports continued to fall, albeit slowly, as foreign trade gained strength following the relaxation of the zero Covid policy.

Exports expanded 14.8 percent on a yearly basis in March, the General Administration of Customs reported Thursday. This was the first growth in six months.

Moreover, the annual growth was more than double the 6.8 percent increase logged in the first two months of the year. The gain also confounded forecasts for a 7.0 percent decline.

Meanwhile, imports logged an annual fall of 1.4 percent. Nonetheless, the drop was slower than economists’ forecast of 5.0 percent decrease as well as the 10.2 percent contraction seen in the January to February period.

Consequently, the trade surplus totaled $88.2 billion, which was well above the expected $39.2 billion.

Although exports registered a surprise growth, the rebound is unlikely to be sustained given the still gloomy outlook for foreign demand, Capital Economics’ Julian Evans-Pritchard said.

However, the economist said imports are likely to pick up further over the months ahead, thanks to the reopening rebound in domestic activity.

After a weaker 3.0 percent economic growth in 2022, the Chinese government set a moderate growth target of around 5.0 percent for this year.

In the latest World Economic Outlook released this week, the International Monetary Fund retained its growth outlook for China at 5.2 percent this year and 4.5 percent in 2024.

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