By Tyler Durden
Overnight China reported its June trade data, which showed that export growth moderated modestly from 12.3% Y/Y in May to 11.3% in June, above the 9.5% consensus, however imports decelerated meaningfully, sliding from 26.0% Y/Y in May to just 14.1% in June, well below the 21.3% estimate, which may be related to the imports tariff cuts on automobiles and selected consumer goods effective on July 1.
In sequential terms, exports increased 0.4% M/M, at the same pace as in May, while imports declined -3.2% M/M slowing from +2.8% in April. As a result of the decline in imports, the trade surplus widened to US$41.6bn from US$24.2bn in May. Tariff changes from the US and China in July can potentially distort June trade data.
“Both imports and exports have seen robust growth in the first half as companies front-load orders ahead of the trade war, resulting in nice-looking year-to-date trade data, but the momentum is hardly sustainable in the future,” said Ding Shuang at Standard Chartered Bank. He said China still has solid domestic demand despite the decline in import growth.
Echoing the concern about the economy, Goldman said that “momentum of exports has slowed notably in recent months in 3m/3m terms. This has …read more
Source:: Zero Hedge