BEIJING (Reuters) – China’s exports and imports unexpectedly accelerated last month in an encouraging sign for the world’s second-biggest economy, though analysts expect growth to continue cooling amid a government crackdown on financial risks and polluting factories.
As global demand has surprised with its strength, consumers have lapped up Chinese goods at a rapid rate this year, giving the economy a boost and providing policy makers room to tighten rules to curb high-risk lending.
Exports in November rose 12.3 percent year-on-year, the fastest pace in eight months, led by strong sales of electronics and high-tech goods, while commodity purchases helped lift imports.
The number beat analysts’ forecast of a 5.0 percent increase and compared with 6.9 percent growth in October.
Imports grew 17.7 percent year-on-year in November, the General Administration of Customs said on Friday, also well above expectations of 11.3 percent growth and rising at the fastest pace since September.
The numbers may help to ease concerns of slowing momentum in Asia’s economic powerhouse, which had surprised markets with robust growth of nearly 6.9 percent in the first nine months of this year, thanks to a government-led infrastructure spending spree and unexpected strength in exports.
“While we still expect China’s domestic economy to cool in 2018 on gradually tighter financial policies, the November import data shows that there are upside risks to our China outlook”, said Louis Kuijs, head of Asia Economics at Oxford Economics in Hong Kong.
China’s commodity imports roar back in November
The latest data showed the country posted a trade surplus of $40.21 billion for the month versus expectations for $35 billion in November after October’s $38.185 billion.
Despite the overall strength of the November data, imports could come under pressure as China’s economy cools, analysts say.
“Chinese trade looks to have been surprisingly strong last month. We expect exports to continue to perform well in the coming months on the back of strong global demand,” Capital Economics China economist Julian Evans-Pritchard wrote in a note.
“However, we are skeptical that the strength of imports can be sustained given that the delayed impact of policy tightening and a cooling property market are set to weigh on Chinese demand for commodities in coming quarters.”