China exports defy trade war concerns
Industrial activity is helping the world’s biggest exporter power through the uncertainty from US President Donald Trump announcing more tariffs
A gauge of activity at China’s manufacturers posted its first gain since November, as factories recovered from a seasonal dip at the start of the year and export demand shrugged off threats of a trade war.
The manufacturing purchasing managers index rose to 51.5 in March versus the 50.6 estimate in Bloomberg’s survey and 50.3 last month. The non-manufacturing PMI, covering services and construction, stood at 54.6, the statistics bureau said on Saturday, compared to 54.4 in February. Levels above 50 indicate improvement.
Industrial activity is helping the world’s biggest exporter power through the uncertainty from US President Donald Trump announcing more tariffs on $50 billion of Chinese imports and Beijing’s retaliation against levies on metals. Overseas shipments surged in February on strong demand amid a synchronised global expansion.
The world is still waiting for the Trump government to detail its list of products after the White House ordered sweeping tariffs targeting China last week over Beijing’s alleged intellectual property violations. US Treasury Secretary Steven Mnuchin said on Monday that he is “cautiously hopeful” on an agreement with China, while pressing the Asian nation to open its markets more. China’s Ministry of Commerce said it is open to negotiations, but will not submit to “unilateral coercion”.
“Exporters would speed up their shipments in order to avoid high tariffs on some products,” said Raymond Yeung, an economist at Australia & New Zealand Banking Group in Hong Kong. “The PMI will bode well for the GDP in the first quarter, which will be higher than the official target of 6.5 per cent. The growth figure will allow bolder reforms, especially for financial deleveraging.”
Manufacturing output surged in March as factories brought production back online after the Chinese New Year holiday the previous month, according to a statement by the statistics bureau. New export orders rose to 51.3 from 49 last month.
“The rebounding PMI in March showed that the distortion effect of Chinese New Year holiday has been eliminated as demand is recovering significantly, and production activities accelerated across the board,” said Chen Zhongtao, an analyst at China Logistics Information Centre.
Updated: April 1, 2018 10:16 AM