China's trade surplus increased in July despite a slowdown in exports growth, official data showed Tuesday.
Exports increased 7.2 percent year-on-year in July, the General Administration of Customs reported. Shipments were forecast to advance 11 percent after climbing 11.3 percent in June.
At the same time, imports grew 11 percent but weaker than June's 17.2 percent expansion. Economists had forecast a faster growth of 18 percent.
Consequently, the trade surplus widened to $46.7 billion in July from $42.7 billion in June. This was also above the expected level of $45 billion.
In yuan terms, exports rose 11.2 percent and imports advanced 14.7 percent. As a result, the trade surplus totaled CNY 321.2 billion in July compared to the forecast of CNY 293.5 billion.
Looking ahead, Julian Evans-Pritchard at Capital Economics said further downside to export growth should be relatively limited given the positive outlook for China's main trading partners.
But with the headwinds to domestic demand from policy tightening increasing, the slowdown in import growth has further to run, the economist said.
Trade data came a day after Fitch Ratings upgraded its global growth outlook citing more pronounced recovery in emerging markets and China in particular.
The recent slowdown in Chinese credit growth is likely to weigh on housing demand in 2018 but housing starts have been holding up well, Brian Coulton, Fitch's chief economist, said.
Moreover, export demand has shown a clear improvement this year. Although Fitch expects a slowdown, the 2017 and 2018 China GDP growth forecasts have been revised up by 0.2 percentage point to 6.7 percent and 0.4 percentage point to 6.3 percent, respectively.
by RTT Staff Writer
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