China: No recovery signs in May's export data

Exports fell 4.1% annually in May, which followed the 1.8% drop recorded in April. Moreover, the print slightly undershot the 4.0% decline that market analysts had expected and highlighted the fragility of global demand.

Meanwhile, imports decreased 0.4% annually in May, which followed the 10.9% decline tallied in April. May’s drop was better than the 6.7% fall that market analysts had expected. While May’s contraction represented the 19th consecutive month of decline, it marked the softest drop since October 2014.

The trade surplus fell from USD 57.2 billion in May 2015 to USD 50.0 billion May this year. The 12-month moving sum of the trade surplus eased from April’s 616 billion to USD 607 billion in April.

FocusEconomics Consensus Forecast panelists project that merchandise exports will contract 2.2% in 2016, while imports will decrease 4.0%, thus driving the trade balance to a surplus of USD 617 billion. For 2017, the panel expects exports to increase 2.9% and imports to rise 2.1%, while the trade surplus will widen further to USD 649 billion.