Chinese Imports, Exports Fall Faster Than Expected in June
China's dollar-denominated exports fell more than expected in June. Imports also shrank more than forecast as waning global demand and Brexit put grey clouds over the world's second-largest economy.
Exports fell 4.8% compared with a year earlier, according to figures from China's General Administration of Customs data reported by Reuters. The state agency added that China's economy faces increased downward pressure and a worsening trade situation. Economists had expected a drop of 4.1%.
Dollar-denominated imports fell 8.4% compared with a year earlier. Economists had expected a fall of 5%.
Exports with major trading partners, including the U.S., fell year-on-year.
"The world economy still faces many uncertainties. For example, Brexit, expectations of an interest rate hike by the Federal Reserve, volatile international financial markets, the geopolitical situation, the threat of terrorism ... these will affect the confidence of consumers and investors globally and curb international trade," customs spokesman Huang Songping said at a press conference.
In contrast, exports in denominated in China's currency, the renminbi, grew by 1.3% year-on-year in June, compared with 1.2% in the month prior. Renminbi-denominated imports fell by 2.3% in the year.
The consensus estimates for exports was for growth of 0.3%. For imports analysts had expected a contraction of 1.2%.
This comes as Chinese Premier Li Keqiang said the economy was "basically stable" and would meet it major targets for the year. He said that second-quarter growth is expected to be close to the 6.7% seen in the first quarter.
Economists are expecting growth to be below first-quarter growth when GDP data are announced on Friday. The Chinese economy is already growing at its slowest pace since the financial crisis.
Weak Chinese growth could spell trouble for luxury retailers, who rely heavily on spending in the country.
Politicians and executives are meeting in Beijing for a two-day European Union-China summit.