In July, investment and consumption data did not see a steady recovery, and the latest foreign trade data was even more eye-popping.
According to data released by the General Administration of Customs, China’s total import and export value in July was 328.73 billion US dollars, an increase of 2.7%. Among them, exports were 176.94 billion US dollars, up 1% year-on-year; imports were 151.79 billion US dollars, from June to July, the export scale decreased by 3.26 billion US dollars, and the import scale increased slightly by 3.31 billion US dollars, so the trade surplus in July was lower than that in June. US$2.01 billion, a total of US$25.15 billion.
Haitong International’s report believes that the continued weakening of global demand and the slowdown of China’s economy have led to a sharp decline in China’s export and import growth in July, further increasing the possibility of RRR cuts.
The data is lower than expected
The total export value in July was lower than the previous market's general forecast of an increase of 8%, which was also lower than the increase of 11.3% in June. The total import value in July was also lower than the market forecast of 7%, which was also lower than the 6.3% increase in June.
Why is the import and export data so bad?
Haitong International believes that due to the ongoing European debt crisis, China’s exports to the EU have dragged down the data.
In the first half of the year, China’s total exports to the EU fell by 0.8% year-on-year, and the decline from January to July further expanded to 3.6%. In addition, China's exports to the United States, Japan and ASEAN countries in the previous July were 11.4%, 6.6%, and 16.2%, respectively, down by 2.2, 1.5, and 0.6 percentage points from the first half of the year.
Wang Yuwen, an analyst at Bank of Communications, analyzed that the continued slowdown in the US economic recovery is not conducive to China's export growth. In the second quarter, US GDP fell to 1.5% year-on-year. In July, the ISM manufacturing PMI was only 49.8%, which was below the dry line for two consecutive months. The import fine index dropped by 3 percentage points to 50.5%, which directly affected China's exports. Shock.
In terms of imports, the year-on-year growth rate of imports in July was higher than that of exports, but it was only 4.7%, which was low in the past two years. The continued slowdown in domestic production demand is the main cause.
Wang Yuwen told reporters that in July, fixed assets investment has rebounded and stabilized to 20.4%, and the output of major industrial products such as steel and cement has gradually recovered. Coupled with the gradual commissioning of projects through preliminary approval, domestic import demand has stabilized, but The short-term effect is not obvious.
Or will soon be lowered
In the troika that drives the economy, if the investment and consumption data released by the National Bureau of Statistics has drawn a question mark for the bottoming up of the Chinese economy, the import and export data on Friday will be red.
Wang Tao, chief economist at UBS, said that the situation of weak imports is not unexpected, because the current sluggish domestic demand is obvious, and commodity prices have also declined. In contrast, the sharp drop in exports is somewhat surprising and unacceptable.
Zhang Zhiwei, chief economist at Nomura Securities, said that exports are expected to be worse in August, as imported goods for processing trade increased by only 0.1% in July, and the new export orders index in PMI continued to fall in these months.
Lu Zhengwei, chief economist of Industrial Bank, has always regarded foreign trade as one of the biggest risks in China's macroeconomics. He said that if a rooted enterprise like export processing can't make money because of demand and cost, Putting accumulated capital into the stock market and the property market will breed a new round of asset bubbles.
Lu political commissar said that there is a trend of migrant workers returning home in advance. The export growth rate in July also confirmed the sluggish export industry, indicating that the economy may be in a state of "warm water" for a long time. In the context of the decline in foreign trade data, the exchange rate policy should be adjusted according to the market. "At present, the effective exchange rate of the RMB is high, and the rationality of continued appreciation does not exist. The correct policy should be to enhance the flexibility of the RMB exchange rate."
As foreign trade data is not strong, the judgments of various institutions on the macroscopic situation are also pessimistic. UBS believes that although measures have been taken to ensure stable investment growth, the current recovery is still erratic. The forecast of 8% economic growth in the third quarter has downside risks. It is expected that the central bank will soon be downgraded.
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