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FX.co ★ China Exports Growth Accelerates Unexpectedly

China Exports Growth Accelerates Unexpectedly

China's exports growth accelerated unexpectedly in September despite power shortages and supply bottlenecks weighing on production, official data showed on Wednesday.

Exports grew 28.1 percent annually after expanding 25.6 percent in August, data from the General Administration of Customs revealed. Economists had forecast an increase of 21 percent.

Meanwhile, annual growth in imports slowed to 17.6 percent from 33.1 percent in the previous month. The rate was below the expected +20 percent.

As a result, the trade surplus rose to $66.7 billion in September from $58.3 billion a month ago, while economists' had forecast the surplus to decline to $46.8 billion. Although power rationing does not appear to have derailed the export sector so far, there is still a risk that it could do so in the coming weeks, Julian Evans-Pritchard and Sheana Yue, economists at Capital Economics, said.

Further ahead, the bigger problem for exports is that foreign demand has been buoyed by large scale stimulus in developed economies and shifts in consumption patterns due to the pandemic, both of which are likely to unwind over the coming quarters, the economists noted.

Imports also look set to drop back further amid slowing property construction and a pullback in commodity prices, they added.

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