China's Exports Surge Despite Rising Trade Tensions

China's exports grew at the fastest pace in over a year in May, reaching $302.35 billion, despite ongoing trade tensions. Imports, however, fell short of expectations. The strong export performance widened China's trade surplus to $82.62 billion. The uptick is partly attributed to a lower base in the previous year.

China's exports in May grew at their fastest pace in over a year, hitting $302.35 billion, despite escalating trade tensions, according to customs data released Friday.

Exports saw a 7.6% jump compared to the same month last year, while imports rose by only 1.8% to $219.73 billion, missing analyst expectations of 4% growth.

The increased export figures are linked to a low base effect from the previous year when exports declined 7.5%. In contrast, April's exports grew by 1.5%, with imports rising by 8.4%.

This surge in exports expanded China's trade surplus to $82.62 billion, up from $72.35 billion in April. The growth comes amid heightened trade tensions with the US and Europe, both considering increased tariffs on Chinese products.

Analysts like Zichun Huang of Capital Economics believe foreign tariffs may actually boost exports in the short term as firms rush to front-run the duties. Additionally, a weaker real effective exchange rate could further support exports.

Meanwhile, China's factory activity slowed more than anticipated in May, with the manufacturing purchasing managers index falling to 49.5.

China is facing challenges in its post-COVID-19 economic recovery, struggling with weaker global demand and a slump in its property sector. Economists suggest more policy support is needed for China to meet its 5% growth target for the year.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)