China's trade grows
Mihir Kapadia – CEO and Founder of Sun Global Investments
The health of the global economy is on the spotlight today as investors digest new trade figures from China. China's exports and imports grew for a fifth straight month in July, but at a slower pace than expected. Exports, in dollar terms, increased 7.2 per cent in July from a year earlier, following growth of 11.3 per cent in June. Economists had expected a growth of 10.9 per cent. Imports in July expanded 11.0 per cent from a year earlier, compared with a 17.2 per cent expansion in June. The increase was less than the forecast for 16.4 per cent gain.
The under par output was also further soured by rising imports, which rose 11 per cent for July, against a notable 17.2 per cent in June. This figure is again below the expected growth of 16.6 per cent, thus contributing to the weakest growth since December, and driving the Chinese trade surplus up to $46.74 billion, the highest since January. A notable slowdown from China is an indicator that something is amiss. For China, this is particularly concerning as it is engaging on a serious path towards emerging as the next global power house.