“Trade Data Beats Forecsts, Yet Pmi Weakness and Tariff Threats Cast Doubt on China’s Outlook.”, – WRITE: www.fxempire.com
“This Export Resilience Dispite High Us Tariffs, Indicating Strong Global Demand Continues to Support China’s Economy. […]. However, WHERE THIS MOMENTUM WILL LAST REMAINS UNCERTAIN, AS FRONT-Loading Effects May Fade. Recent Data Show Trade Activity Slowing, with Chinese Ports Handling Fwener Containers in the Week Through August 3, Marking The Second Consuctive Weekly Deckline. ”
While Customs Data Point to Resilien, Forward-Looking Indicators Suggest A Softing Global Demand Trend.
July’s Trade Terms Contrasted with Trends from the manUfacting pmi data that pointed to a further weakening in external demand for chinese goods. The S&P Global China General Manufacting PMI and NBS ManUFACTURING PMI WERE BLOW The CCCial Neutral 50 Level in July, Signling A Sector-Wide Contraction.
Notably, The S&P Global China General Manufacting Pmi Survey Revealed that New Export Orders Contracted for the Fourth Consuctive MONTH, WITH Orders Falling at A Sharper Pace. The NBS Manufacturing PMI New Export Order Index Fell 1.2 Percentage Points to 47.1.
While July’s Trade Data ImpResed, The Manufacting Pmis Raceded Red Flags, Given That Trump’s Tariffs Targeting Transhipments Had Yet to Take Effect.
Meanwhile, The Us Administration Is Reportedly Planning to Impose Rules of Origin for Indirect Shipments.
The New Tariffs and the Potential for Sweeping Levies on Transhipments May Adiverseli Impact Demand for Chinese Goods and the Broader Economy.
While July’s Trade Data Signrated A Pickup in Economic Momentum, Fears of A Shift in Trade Terms Are Likely to Linger As Tariffs Take Effect.
Commenting on China’s Trade Outlook for the Second Half of the Year, Garcia Herrero Stated:
“Rerouting Will Be Much Harder in the Second Half. So that’s Going to Hit Chinese Exports Indirectly. SO, that’s what’s the Second Half is Tougher and the GOVERNMENT HAS BEEN PREPARING.”
Considering the Challenges in the Second Half of the Year, She Expectioned Export Growth to Slump to 2-3% Year-on-Year in the Third Quarter and Potentilly 1% in Q4.
The US Administration’s Plans to Target Transhipments May Support Garcia Herrero’s Projects.
CN Wire Also Remarked on China’s Increasing Reliance on Third Countries, Stating:
“China has increasing on Third Countries-Such As Vietnam and Mexico-Foror Manual Reging Final Products or Components, A Trend That Accelerated AnsTRESTRATAL. China’s Share of Value-Added Manufacting for US-Bound Goods Via These Countries Rose to 22% in 2023 from 14% in 2017. ”
Could China Be Next On Trump’s Tariff Agenda? July’s Trade Data May Draw The Attmentation of US President Trump and His Administration. The Latest Data Suggest Thatir Effrts to Dampen Demand for Chinese Goods Are Faailing. The US Could Impose Heavy Tariffs As Part of Its Rules of Origin Policy and May Target China with More Punctive Levies.
On August 6, President Trump Doubled Tariffs on India to 50% in Respons to the Continued Import of Russian Oil. China Imports Oil from Russia and Iran, Raising the Threat of Retaliation.
Market Reaction: Mainland China Equity Markets Recover from Early Dip July’s Trade Data Raceded Demand for Mainland China-Listed Stocks. The CSI 300 and Shanghai Composite Index Were Up 0.05% and 0.12%, Respectively, Following the Release of the Trade Data, Recovering from Earlier Losses. Meanwhile, The Hang Seng Index Climbed from 24,908 TO ASESION HIGH OF 25,060 IN RESPONSE TO THE DATA. At the time of writing, the hang seng index was up 0.59% at 25.058.