Chinese Trade Data Confirms Growth Worries

From Market Watch:


China’s trade surplus widened in May to $20.43 billion from $18.16 billion in April.
Exports rose 1.0% in May from a year earlier, data from the General Administration of Customs showed Saturday. This was much slower than April’s 14.7% rise and below the economists’ median forecast of a 5.6% expansion
Imports fell 0.3% from a year earlier, compared with a 16.8% rise in April and missing the economists’ median forecast of a 5% increase.


Although at first reading, the increase in trade surplus seems to be a good signal for Chinese growth, this is not the case. The fact is that exports posted their lowest growth rate in almost a year in May while imports unexpectedly fell.
These data traduce weakness in domestic demand because of slowdown in consumption and investment but also sluggish global demand due to the impact of sizeable exchange rate appreciation.