Export growth accelerated from 14.5% in September to 15.6% in October. The reading surprised market analysts as they had expected a slowdown to a 11.0% rise. Nomura analysts comment that:
“The rise in export growth was mainly driven by emerging markets such as Brazil and Russia. China’s exports to the US dipped in October. We believe front-loading activity continued in October and will extend into the last two months of 2018 as exporters hurry their shipments in anticipation of higher tariff rates in 2019. We note that freight rates for exports to the US have recently surged compared those to other destinations.”
Imports expanded at double-digit figures for the eighth consecutive month in October, rising 21.4% year-on-year (September: +14.3% year-on-year). The print was well above the 14.0% rise that market analysts had expected and reflected stronger imports of crude oil and iron ore.
The trade surplus consequently fell from USD 36.9 billion in October 2017 to USD 34.0 billion in October 2018 (September 2018: USD 31.7 billion). The 12-month moving sum of the trade surplus decreased from USD 351 billion in September to USD 348 billion in October.
China Trade Balance Forecast
Our panelists forecast that exports will expand 5.7% in 2019 and imports will rise 8.0%, bringing the trade surplus to USD 316 billion. In 2020, FocusEconomics panelists expect exports will expand 2.9%, while imports will rise 5.8%, bringing down the trade surplus to USD 258 billion.