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Yahoo
2 days ago
- Business
- Yahoo
China's May exports slow, deflation deepens as tariffs bite
By Yukun Zhang, Qiaoyi Li and Ryan Woo BEIJING (Reuters) -China's May exports growth slowed to a three-month low as U.S. tariffs slammed shipments, while factory-gate deflation deepened to its worst level in two years, heaping pressure on the world's second-largest economy on both the domestic and external fronts. Exports expanded 4.8% year-on-year in value terms in May, slowing from the 8.1% jump in April and missing the 5.0% growth expected in a Reuters poll, customs data showed on Monday, despite a lowering of U.S. tariffs on Chinese goods which had taken effect in early April. Imports dropped 3.4% year-on-year, deepening sharply from the 0.2% decline in April and worse than the 0.9% downturn expected in the Reuters poll. Exports had surged 12.4% year-on-year and 8.1% in March and April, respectively, as factories rushed shipments to the U.S. and other overseas manufacturers to avoid U.S. President Trump's hefty levies on China and the rest of the world. While exporters in China found some respite in May as Beijing and Washington agreed to suspend most of their levies for 90 days, tensions between the world's two largest economies remain high and negotiations are underway over issues ranging from China's rare earths controls to Taiwan. Trade representatives from China and the U.S. are meeting in London on Monday to resume talks after a phone call between their top leaders on Thursday. China's May trade surplus came in at $103.2 billion, up from the $96.18 billion the previous month. Beijing in May rolled out a series of monetary stimulus measures, including cuts to benchmark lending rates and a 500 billion yuan low-cost loan program for supporting elderly care and services consumption. The measures are aimed at cushioning the trade war's blow to an economy that relied on exports in its recovery from the pandemic shocks and a protracted property market slump. DEFLATIONARY PRESSURES Producer and consumer price data, released by the National Bureau of Statistics on the same day, showed that deflationary pressures worsened last month. The producer price index fell 3.3% in May from a year earlier, after a 2.7% decline in April and marked the deepest contraction in 22 months, while consumer prices extended declines, having dipped 0.1% last month from a year earlier. Cooling factory activity also highlights the impact of U.S. tariffs on the world's largest manufacturing hub, dampening faster services growth as suspense lingers over the outcome of U.S.-China trade talks. Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
China's May exports slow, deflation deepens as tariffs bite
By Yukun Zhang, Qiaoyi Li and Ryan Woo BEIJING (Reuters) -China's May exports growth slowed to a three-month low as U.S. tariffs slammed shipments, while factory-gate deflation deepened to its worst level in two years, heaping pressure on the world's second-largest economy on both the domestic and external fronts. Exports expanded 4.8% year-on-year in value terms in May, slowing from the 8.1% jump in April and missing the 5.0% growth expected in a Reuters poll, customs data showed on Monday, despite a lowering of U.S. tariffs on Chinese goods which had taken effect in early April. Imports dropped 3.4% year-on-year, deepening sharply from the 0.2% decline in April and worse than the 0.9% downturn expected in the Reuters poll. Exports had surged 12.4% year-on-year and 8.1% in March and April, respectively, as factories rushed shipments to the U.S. and other overseas manufacturers to avoid U.S. President Trump's hefty levies on China and the rest of the world. While exporters in China found some respite in May as Beijing and Washington agreed to suspend most of their levies for 90 days, tensions between the world's two largest economies remain high and negotiations are underway over issues ranging from China's rare earths controls to Taiwan. Trade representatives from China and the U.S. are meeting in London on Monday to resume talks after a phone call between their top leaders on Thursday. China's May trade surplus came in at $103.2 billion, up from the $96.18 billion the previous month. Beijing in May rolled out a series of monetary stimulus measures, including cuts to benchmark lending rates and a 500 billion yuan low-cost loan program for supporting elderly care and services consumption. The measures are aimed at cushioning the trade war's blow to an economy that relied on exports in its recovery from the pandemic shocks and a protracted property market slump. DEFLATIONARY PRESSURES Producer and consumer price data, released by the National Bureau of Statistics on the same day, showed that deflationary pressures worsened last month. The producer price index fell 3.3% in May from a year earlier, after a 2.7% decline in April and marked the deepest contraction in 22 months, while consumer prices extended declines, having dipped 0.1% last month from a year earlier. Cooling factory activity also highlights the impact of U.S. tariffs on the world's largest manufacturing hub, dampening faster services growth as suspense lingers over the outcome of U.S.-China trade talks.
Yahoo
19-05-2025
- Business
- Yahoo
China's factory output resists tariff impact, retail sales disappoint
By Tina Qiao, Ellen Zhang and Ryan Woo BEIJING (Reuters) -China's factory output slowed in April but showed surprising resilience, a sign that government support measures may have cushioned the impact of a trade war with the U.S. that threatens to derail momentum in the world's second-largest economy. Industrial output grew 6.1% from a year earlier, National Bureau of Statistics (NBS) data showed on Monday, slowing from 7.7% in March but beat a forecast 5.5% rise in a Reuters poll. "April's resilience is in part a result of 'frontloaded' fiscal support," said Tianchen Xu, senior economist at the Economist Intelligence Unit, referring to stronger government spending. The data followed firmer-than-expected exports earlier this month that economists said were supported by exporters rerouting shipments and countries buying more materials from China amid a re-ordering of global trade due to U.S. President Donald Trump's tariffs. However, Monday's data underscored the shock from U.S. reciprocal tariffs, Xu said, adding "despite the rapid growth in industrial value-added, the export delivery value was nearly stagnant." Beijing and Washington reached a surprise agreement last week to roll back most tariffs imposed on each other's goods since early April. The 90-day pause has put the brakes on a trade war that has disrupted global supply chains and stoked recession fears. "China's foreign trade has overcome difficulties and maintained steady growth, demonstrating strong resilience and international competitiveness," Fu Linghui, statistics bureau spokesperson, told a press conference on Monday. He added that the trade de-escalation would benefit bilateral trade growth and global economic recovery. But economists have warned that the short-term truce and U.S. President Donald Trump's unpredictable approach will continue to cast a shadow over China's export-driven economy, which still faces 30% tariffs on top of existing duties. By midday, China's blue-chip CSI300 Index dropped 0.4% and the Shanghai Composite Index lost 0.1%. The yuan currency also slipped against the dollar. PRESSURES REMAIN The property sector has yet to show signs of recovery, with home prices stagnating and investment in the sector shrinking. Retail sales, a measure of consumption, rose 5.1% in April, down from a 5.9% increase in March, and missed forecasts for a 5.5% expansion. Economists attributed the slowdown to the impact of U.S. tariffs on consumer expectations and tepid demand at home. Commodity sectors also showed signs of weakness with the country's daily crude oil processing rate down 4.9% in April from March, while crude steel output slid 7% month-on-month. Meanwhile, the government's push to boost household spending via a trade-in scheme for consumer goods led to a 38.8% gain in home appliance sales. The NBS data also showed the unemployment rate fell to 5.1% from 5.2% in March. But anecdotal evidence showed that some factories heavily reliant on the U.S. market have sent their workers home. With persistent deflationary pressures and worse-than-expected bank lending data, economists highlighted the need for more policy support to foster a sustainable recovery. "We caution that the near-term growth strength is at the cost of payback effects later and believe more policy easing is necessary to stabilise growth, employment and market sentiment," Goldman Sachs economists said in a note. China's economy expanded 5.4% in the first quarter, exceeding expectations. Authorities remain confident of achieving Beijing's growth target of around 5% this year, despite warnings from economists that U.S. tariffs could derail this momentum. Alarmed by how tariffs have hurt economic activity, authorities earlier this month announced a package of stimulus measures, including interest rate cuts and a major liquidity injection. The monetary easing measures were announced before the China-U.S. trade detente was reached after high-stakes talks in Geneva, marking a significant de-escalation from months of mounting tensions. The U.S.-China "deal" agreed at the start of last week will provide some relief, said Julian Evans-Pritchard, head of China Economics at Capital Economics, "but even if the tariff rollback proves durable, wider headwinds mean that we still expect China's economy to slow further over the coming quarters." "We suspect that the trade war has made households more concerned about their job prospects and therefore more careful about their spending."
Reuters
29-04-2025
- Climate
- Reuters
China delays return of Shenzhou-19 crewed spacecraft, Xinhua reports
BEIJING, April 29 (Reuters) - China has delayed the return of the Shenzhou-19 crewed spacecraft due to weather conditions at the landing site, the state-run Xinhua news agency reported on Tuesday. Make sense of the latest ESG trends affecting companies and governments with the Reuters Sustainable Switch newsletter. Sign up here. Reporting by Xiuhao Chen and Ryan Woo; Editing by Andrew Heavens
Yahoo
28-03-2025
- Business
- Yahoo
French foreign minister says China is to delay conclusion of Cognac investigation
By Ryan Woo and Tassilo Hummel BEIJING (Reuters) -The Chinese investigation which led to hefty preliminary import tariffs on French-made cognac and armagnac will conclude later than initially planned, France's foreign minister said during a trip to the country. "Following this visit, I received confirmation that the investigation has been postponed by three months, which rules out the scenario of a sudden application of definitive law to this sector," Jean-Noel Barrot told journalists. The move will not lift existing tariffs, but it hands the embattled cognac industry some "breathing space" before any duties become definitive during which French state officials and industry players could further step up their lobbying efforts, Barrot said. Shares in French drinks companies Remy Cointreau and Pernod Ricard also rose sharply and were up by around 3% during Friday afternoon trading. China imposed temporary anti-dumping measures on imports of brandy from the EU after the 27-state bloc voted for tariffs on Chinese-made electric vehicles (EVs), heavily hitting sales of cognac, a high-end brandy produced in western France. China has also essentially banned cognac duty free sales due to the tensions, industry officials said. France's BNIC cognac industry group issued a cautious response to Barrot's announcements. "We have taken note of this and are awaiting the French government's detailed debrief in the near future," BNIC said. The step heavily impacted the French cognac industry at a time when it is also grappling with similar trade tensions with the United States. China and the United States are the cognac industry's most important export markets. The Chinese commerce ministry could not be immediately reached for comment outside of business hours.
