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Chinese export and import growth slows sharply in November

By Alexander Bueso

Date: Sunday 09 Dec 2018

Chinese export and import growth slows sharply in November

(Sharecast News) - Both Chinese exports and imports slowed last month with the former buoyed by firms' attempts to front-run the new US tariffs that had been expected to kick-in at the start of 2019.
In comparison to the year-earlier month, Chinese exports grew by 5.4% in November, which was down from the 15.6% pace observed in October.

Export volumes slowed even more sharply, from a 9.8% clip for October to just 0.3% in November.

Commenting on the figures which were published on Saturday, Louis Kuijs at Oxford Economics said: "Export growth to all major destinations weakened in November, probably reflecting weakening global trade momentum."

Sales to the US on the other hand held up "relatively well", increasing at a year-on-year pace of 9.8%, even as imports from the States fell by 25% year-on-year.

Hence, the Asian giant's bilateral trade surplus with the US widened from $31.78bn for October to $35.55bn last month.

That brought the year-to-date surplus to $293.52bn, versus $251.26bn one year ago.

Total imports also slowed, from October's clip of 20.8% to 3% and were down by 1.5% in volume terms, Kuijs said, reflecting slower growth in China itself.

Nonetheless, in the aftermath of the "surprisingly constructive" trade talks in Buenos Aires and despite now anticipating less policy stimulus from Beijing, Kuijs bumped-up his forecasts for Chinese GDP growth in 2018 and 2019 by one tenth of a percentage point to 6.6% and 6.1%, respectively.

"The postponement of tariff hikes agreed in Buenos Aires was a positive for China. Compared to our previous baseline assumptions, it should help exports and confidence, leading to better business investment and consumption. Even with less policy easing than we previously assumed, the overall impact should be positive.

"But new US-China tensions are already emerging after the arrest of Huawei's CFO in Canada at the behest of the US, suggesting downside risks to growth."

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