China’s Imports and Exports Shrink amid COVID-19 Curbs
China’s exports and imports unexpectedly contracted in October, the first simultaneous slump since May 2020, as a storm of COVID-19 curbs at homes in and global recession risks dented demand and further darkened the outlook for a struggling economy.
The data highlights the challenge for policymakers in China as they press on with pandemic prevention measures and try to navigate broad pressure from surging inflation, sweeping increases in worldwide interest rates and a global slowdown.
Outbound shipments in October shrank 0.3% from a year earlier, a turnaround from a 5.7% gain in September, official data showed on Monday, and well below analysts’ expectations for a 4.3% increase. It was the worst performance since May 2020.
The data suggests demand remains frail overall, and analysts warn of further gloom for exporters over the coming quarters, heaping more pressure on the country’s manufacturing sector and the world’s second-biggest economy grappling with persistent COVID-19 curbs and protracted property weakness.
Also, Chinese exporters weren’t able to capitalise on a prolonged weakening in the yuan currency since April and the key year-end shopping season, underlining the broadening strains for consumers and businesses worldwide.
The yuan on Monday eased 0.4% from a more than one-week high against the dollar.
Meanwhile, Apple Inc. said it expects lower-than-anticipated shipments of high-end iPhone 14 models following a key production cut at the virus-blighted Zhengzhou plant.
Overall exports to China’s major markets of the United States and European Union also slumped in October, off 12.6% and 9% year-on-year, respectively.
Reuters/Hauwa Abu
