SINGAPORE—China’s exports unexpectedly fell in October, the biggest sign of global trade slowing as consumers and businesses cut spending in response to central bank measures to curb inflation.
Exports from China fell 0.3% last month from a year earlier, China’s General Administration of Customs said on Monday, the weakest move since May 2020, as trade was disrupted by countries’ initial efforts to contain the global pandemic. This was lower than economists polled by The Wall Street Journal, which expected exports to grow 4% annually.
The drop in exports from the world’s factories is adding to the gloom over the global economy. The booming US labor market is showing signs of cooling as the Federal Reserve raises interest rates to curb inflation. Europe is bracing for a colder winter after Russia decided to cut power in response to sanctions over the Ukraine conflict.
Data on Monday showed US exports fell 13% year-on-year in October, the third straight month of decline, while exports to the European Union fell 9%.
For China, the world’s second-largest economy, the sharp fall in demand for its exports removes a key avenue for growth at a time when its economy is under pressure from the government’s Covid-19 easing measures and housing sales. to fall.
Chinese health officials said on Saturday that China would stick to its strict Covid-19 prevention policy, dampening hopes in recent days of easing the pandemic’s tougher measures following a Communist Party meeting that was reviewed last month.
Lockdowns have disrupted economic activity throughout the year, and the threat of other measures to contain even the smallest outbreaks of Covid-19 means consumers are reluctant to spend and businesses are reluctant to invest, adding to the drag of damaged goods.
Exports have helped support China’s economy, but growth has slowed in recent months. Some of Asia’s bellwether exporters, such as South Korea and Taiwan, have reported falling exports as the global economy slows. Zichun Huang, an economist at Capital Economics, said in a note to clients on Monday that he expects Chinese goods to fall in the coming months as the global economy slows.
Economists say this and more will mean China is on the verge of meeting the government’s initial target of 5.5% growth this year, and has recorded its worst 12 months of growth, other than the first year of the pandemic – in years.
The drop in exports in October followed several months of slow growth. Exports in September rose at an annual rate of 5.7%, down from two quarters of China’s exports during the year.
China’s exports fell 0.7% in October from a year earlier, reflecting a slowdown in China’s economy.
This was also weaker than economists’ expectations, which means China’s trade volume increased in October to $85.15 billion, up from $84.7 billion in September.
Xiao Xiao in Beijing contributed to the story.
Contact Jason Douglas at [email protected]
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