Chinese export declined in October for seventh consecutive month, as weak demand continued to weigh on the economy. However, the decline was not as sharp as in September. The Chinese exports decreased by 7.3% yoy, highly below the forecast for decrease of 5.7%, but better than result in September, when decline was 10%. Although domestic demand was supported by government incentives, there were not many tools to influence foreign demand
Imports in October fell by 1.4% yoy, which largely meet expectations, but also a better result than 1.9% drop in September. The imports benefited mainly due to increased demand for raw materials, which in turn is supported by sales of residential properties in leading markets. The prices of iron ore increased by 15% mom and appreciation in oil amounted to 1.5% in October.
The trade surplus expanded by 49.06 billion USD in October, which is less than expected. In September surplus was 41.99 billion USD.
The orders are speeding up in October after two typhoon in September delayed deliveries. The improved business attitudes in USA and Germany also contributed, but it may take several months before Chinese exports recovered enough to help the overall expansion.
This year, the Chinese authorities have not set targets for the trade balance, since in 2015 and 2014 did not achieve these objectives of 6% and 7.5%. During the first 10 months of 2016, the exports and imports of China as a single indicator decreased by 7.6%.
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