Stronger core exports in August capped a rise in outlook – UOB Group

August export growth accelerated to 8.7% y/y (Bloomberg Est: 6.6%, July: 7.0%) in USD terms and 8.4% y/y in CNY terms (July: 6, 5%), notes UOB Group economist Ho Woei Chen.

Positive headline exports but weaker imports raised caution

“China reported stronger export growth in August, but the outlook was weighed down by steady import growth and emerging signs of weaker external demand.”

“In volume terms, China’s commodity demand has remained resilient despite signs of a slowing economy. Imports of refined petroleum products, LPG and soybeans strengthened considerably in August. Iron and copper imports moderated from a year ago, indicating weaker construction activity.”

“The low base effect is likely to continue to support both export and import growth for the rest of the year. We expect China’s exports and imports to grow in 2024 to 5.0% (2023: -4.6%) and 4.5% (2023: -5.5%), respectively.