China exports continue to be hit by US tariffs
Published: 08:25 09 Jun 2025 BST
Chinese exports continued to be hit last month as demand from the US plunged following the imposition of heavy tariffs by Donald Trump.
Export growth from the world's second-largest economy eased to 4.8% in May compared to a year earlier, with shipments to the US down 12.7%. This was below the average forecast of 6% growth.
Imports from the US dropped 17.9% as Beijing responded with retaliatory measures, with overall imports down 3.4% compared to a 0.2% drop in April.
Data on a monthly basis painted a slightly different picture, economists at Pantheon Macroeconomics said, with exports rebounding by 0.7% after a fall of -0.3% a month earlier, while the plunge in US monthly shipments eased significantly, to -3.5% from -26.0% a month ago, while exports to the EU rebounded by 6.5% following nearly flat growth in April.
Adding to concerns, China’s consumer price inflation in negative territory for the fourth consecutive month, while factory gate prices dropped 3.3% year-on-year – both signs of persistent deflationary pressure.
High-level US-China trade talks are set to resume in London this week, with rare earth exports on the agenda amid efforts to ease tensions.
Chinese equities were positive as they are "supported by hopes that weak macro data will prompt further stimulus from the People’s Bank of China (PBoC) and the government," said market analyst Ipek Ozkardeskaya at Swissquote Bank, as well as hopes that the talks today in London could lead to further progress.
"Last week, a phone call between Trump and Xi yielded news that China would relax export controls on rare earth metals to the US, suggesting the US may also ease restrictions on certain technology exports."
