China’s Exports Hit Record Growth, Import Growth Accelerates

China’s export growth hit a new record in November but faced pressure from a strong yuan as well as weakening demand and higher costs. Import growth quickened, indicating stronger domestic activity.

Data released earlier in the day showed that exports grew 22% year on year, above the 19% growth inf forecasts prepared by Investing.com but below October’s 27.1% growth.

Imports grew 31.7%, well above the 19.8% growth in forecasts prepared by Investing.com but below the 20.6% growth recorded in October.

The data comes a day after the People’s Bank of China said it would reduce most banks’ reserve requirement ratio by 0.5 percentage points next week. The central bank’s second such move in 2021 will release CNY1.2 trillion ($188.16 billion) of liquidity.

China has staged an impressive economic recovery from COVID-19, but power shortages, regulatory crackdowns, and the property sector’s debt woes remain roadblocks.

China could issue more policy measures to support the recovery in the months ahead, with Premier Li Keqiang saying on Monday that China has room for a variety of monetary policy tools.

On the COVID-19 front, China has to date not recorded any cases of the omicron variant. However, if it emerges, it could add pressure to China’s zero-tolerance policy towards the virus and increase logistical pressures for exporters, according to analysts.

The data also showed a trade balance of $71.72 billion in November, with forecasts prepared by Investing.com’s predicting an $82.75 billion balance, and an $84.54 billion balance recorded in October.

China’s Exports Hit Record Growth, Import Growth Accelerates