China’s exports and imports fell last month, as a tariff standoff with the US took its toll on the economy.
The Chinese trading outlook waned in June, according to new figures that underline the country’s current growth troubles.
Read more: Hunt is right to take a firm line on China
China’s customs department reported today that dollar-denominated exports tumbled 1.3 per cent in June when compared with the same month in the previous year, while imports slumped 7.3 per cent.
“Exports declined last month as a result of the step-up in U.S. tariffs in May and waning global demand,” noted Julian Evans-Pritchard, senior China economist at Capital Economics.
He added: “Imports also weakened on the back of a renewed domestic slowdown.”
The latest data comes after Donald Trump and Xi Jinping agreed at a recent summit in Japan not to implement any further trade tariffs for the time being.
However, fears of an impasse in the trade dispute between Beijing and Washington, D.C. and a global financial slowdown still loom large over the economy.
During the first six months of this year, China’s exports grew 0.1 per cent in US dollar terms, marking a sharp drop from 12.8 per cent during the same period last year.
Imports declined 4.3 per cent from January to June, compared with a rise of nearly 20 per cent last year.
According to South China Morning Post calculations, China’s exports to the US fell by 7.8 per cent to $39bn (£31bn) in June, while imports fell 31.4 per cent to $9 billion.
Fears of a slowdown follow a day on from chairman of the US Federal Reserve Jay Powell boosting the market’s expectations that the first interest rate cut in ten years will come this month with a gloomy testimony to a congressional committee.
Mihir Kapadia, the chief executive of Sun Global Investments, said: “The Fed’s inclination for a rate cut comes at a time when investors remain concerned about major economies remaining robust. Underscoring global growth concerns, Singapore reported a slump in its economy while China reported weak export data. The news from Singapore is especially concerning as it is often considered a benchmark for global economic activity given its heavy reliance on international trade.”