Chinese exports exhibit surprising strength

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Chinese exports exhibit surprising strength

China’s exports increased more than estimated in August, helping the government’s efforts to sustain an economic rebound.

Overseas shipments rose 7.2 percent from a year earlier, the General Administration of Customs said in Beijing yesterday. That compares with the 5.5 percent median estimate of 46 economists surveyed and July’s 5.1 percent gain. Imports rose a less-than-estimated 7 percent from a year earlier, leaving a trade surplus of more than $28 billion.

China’s economy is showing signs of picking up after the government announced support measures such as tax cuts for small businesses and extra spending on railways, and as confidence returns after the interbank cash squeeze in June. Improvements in developed nations may support exports in coming months, with the euro-area returning to growth in the second quarter after a record-long recession.

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 economic growth, economists Liu Li-Gang and Zhou Hao at Australia and New Zealand Banking Group said in a note after the release. “In value terms, China’s exports hit the highest level this year, suggesting that external demand has picked up.”

Premier Li Keqiang and other officials are seeking to maintain confidence, saying the nation will achieve its 7.5 percent growth goal this year.

The yuan has gained more than 3.6 percent against the dollar over the past 12 months, compared with a decline of more than 21 percent for the yen, adding to pressure on Chinese exporters. At the same time, China’s currency increased only about 0.3 percent in the past three months, slowing from the pace of appreciation in previous months.

Earlier this year, the nation’s export figures were inflated by fake shipments used to disguise capital flows.

Commerce Minister Gao Hucheng said last week China’s exports and imports will rebound in coming months on a stronger recovery in developed countries, according to an interview at the G-20 summit in Russia.

The National Bureau of Statistics will release August inflation and producer-price data today,

Bloomberg

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