China's trade boomed in September, reaffirming the world's second largest economy is recovering from the pandemic
- China's trade boomed in September, with imports rising 13.2% year-on-year, easily beating expectations for an increase of 0.3%, while exports rose 9.9% year-on-year.
- Medical supplies, including personal protective equipment, and electronics fueled the rise in exports.
- China's trade surplus with the US fell to 30.75 billion in September down from $34.24 billion in August.
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China's imports grew at their fastest pace so far this year in September, while exports continued to expand, as ongoing recovery in the world's second largest economy fed an improvement in domestic consumption.
Official data on Tuesday showed imports rose by 13.2% year-on-year in September, far above market expectations for an increase of 0.3%, and up from August's 2.1% drop. This was also the first increase in imports in three months, as domestic activity picked up.
Exports from China also posted solid growth, rising 9.9% year-on-year, marking the fourth consecutive month of increase in overseas sales, thanks in large part to demand for medical supplies and electronics.
"What had been more concerning, and had been for some time, was the weakness in the imports data and which until last month had been showing little sign of a significant pickup," CMC Markets chief markets strategist Michael Hewson said. "This appears to have finally changed, as imports for September surged to their best levels this year, rising 13.2%."
Exports were broadly in line with expectations and followed a 9.5% increase in August.
China was the first country to be hit by the pandemic with an outbreak in Wuhan province and, as such, it is the first major economy to resume most business activity.
China's closely watched trade surplus with the United States fell to $30.75 billion in September from $34.24 billion in August, leaving the surplus for the first nine months of the year at $218.57 billion.
Under a "phase one" agreement that Beijing and Washington signed in January, China agreed to expand its purchases of certain US goods and services by a combined $200 billion over 2020 and 2021, compared to 2017 levels.
Market watchers have pointed out China is far from meeting these conditions.
In order to meet that obligation, think-tank Peterson Institute for International Economics predicts China will need to buy a total of $172.7 billion US goods by the end of this year.
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