China’s fall in exports raise concerns of severe slowdown

China’s August exports declined less than forecast but a bigger fall in imports suggested continuing economic weakness, adding to concerns over the health of the world’s second-largest economy that have been rattling global markets.

Exports fell 5.5 percent from a year earlier, slightly less than a 6.0 percent drop expected and improving from an 8.3 percent drop in July.

Imports shrank for a 10th month in a row, slipping 13.8 percent, much more than the expected 8.2 percent, after an 8.1 percent decline in July, reflecting both lower global commodity prices and persistently sluggish domestic demand.
The data shows China’s trade surplus at $60.24 billion for the month, according to the General Administration of Customs. This was higher than forecasts for $48.20 billion.

Global investors will be combing China’s August data over the coming weeks to see if the economy is at risk of a hard landing. Many are not optimistic about the prospect of exports and it’s unlikely China can achieve the export target this year.

Though most economists believe a gradual and prolonged slowdown is more likely, a stock market crash and the unexpected devaluation of the yuan currency in August have heightened concerns about stability and policymaking in China.

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