Chinese exports, imports smash forecasts in May

BEIJING: China posted a forecast-busting surge in exports and imports in May, official data showed on Thursday, signalling improvement in the world's number two economy.

Exports rose 8.7 percent to $191 billion while imports jumped 14.8 percent to $150.2 billion year-on-year.

Analysts surveyed by Bloomberg News had forecast a 7.2 percent rise in exports and 8.3 percent increase in imports. The trade surplus rose to $40.8 billion, up $2 billion from April.

The readings will come as a relief to China-watchers after a series of weak readings suggesting a recent pick-up in the economy could be fizzling, while there are also lingering concerns about US President Donald Trump's protectionist rhetoric.

An independent survey of factory activity indicated the manufacturing sector contracted in May for the first time in almost a year, hinting at deteriorating conditions for producers in China.

Other figures have pointed to slowing growth in the Chinese economy as it deals with weaker demand and excess industrial capacity left over from a debt-fuelled infrastructure boom.

Data released last month showed growth in industrial output, retail sales and fixed-asset investment had hit the brakes.

China's economy expanded last year at its weakest rate in more than a quarter of a century and Beijing has indicated it expects growth to slow further this year.

Slowing growth is a major concern for stability-obsessed policymakers and it complicates their efforts to retool the economy into one driven by consumer demand rather than state investment and exports.

The transformation has been rough at times and China is hoping that its much-vaunted Belt and Road infrastructure project will provide a new source of growth.

Beijing has earmarked hundreds of billions of dollars for investment in roads, railways, ports, industrial parks and power plants in some 65 countries across Asia, Africa and Europe in a drive to fan economic growth and regional co-operation.