China Exports Fall Less Than Forecast; Imports Plunge

September imports sank 20.4 percent to $145.2 billion in dollar terms, the customs department said – worse than forecast in a survey of economists by Bloomberg News.

China’s trade in the first three quarters fell 7.9 percent year on year to 17.9 trillion yuan, below the government’s target of about 6 percent growth. “Moreover, the better export data could be partially explained by a rather large appreciation of Euro against CNY in September from August, compared to a sharp depreciation of Euro against CNY in August-September 2014”, he noted. “We maintain our view that GDP growth will decline to 6.7% in the third quarter”.

“In seasonally adjusted level terms, today’s data are consistent with a continued recovery in exports since the start of the year, when global trade was very weak”, said Julian Evans-Pritchard, China economist at Capital Economics.

However, Customs department spokesman Huang Songping told reporters: “Imports of a few of the bulk commodity exhibited an increase in volume and a fall in price”. On the export side, the weakness in the yuan since the record 1.9 per cent devaluation on August 11 has made shipments from China more attractive to overseas buyers. Mr Evans-Pritchard suggested paying closer attention to monthly trends, which showed a steady rise to most major export markets in the U.S. and Europe over the summer.

Exports slid 3.7 percent in September from a year ago, the General Administration of Customs reported Tuesday. Li-Gang Liu, Chief Economist for Greater China at ANZ Bank, said in a note to worldwide Business Times Tuesday that the global launch of new smartphone models – including Apple’s iPhone 6S – in September was likely to have boosted export figures. The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 0.1 per cent to 3,445.04, while the Shanghai Composite Index gained 0.2 per cent to 3,293.23 points.

While falling commodity prices partially account for the lower value of imports, which are heavily skewed towards commodities like oil and iron ore, weak demand for property and cars across China is also a factor.

The latest trade data does not bode well for data on the third quarter’s gross domestic product, due for release on Monday.