China’s exports are down 14.5 percent year-over-year, and imports are down 12.4 percent.

Trade Collapse

The Chinese export economy isn’t just having a nice little slowdown - it’s absolutely collapsing.

July 2023 exports plunged 14.5% YoY, the steepest dip since Feb 2020, following a 12.4% fall in June, hinting at plummeting global demand. pic.twitter.com/3jem2OVnUk

— Don Johnson (@DonMiami3) August 8, 2023

Consensus Miss

Once again, #China's exports and imports contracted by more than consensus forecasts:
Exports fell by 14.5% in July (year-on-year), worse than the consensus forecast of 12.5%; and
Imports declined by 12.4%, a lot worse than the expected 5%.
The numbers confirm that the #economy's…

— Mohamed A. El-Erian (@elerianm) August 8, 2023

“The numbers confirm that the economy’s mounting growth shortfalls reflect both domestic and external challenges.”

Exports Fall Third Month

China’s exports fall for a third straight month in July as weak global demand adds to pressures undermining economic recovery https://t.co/v6W4FbHsZy

— Bloomberg Economics (@economics) August 8, 2023

China’s exports fell for a third straight month in July amid a slump in global demand, while imports plunged as domestic pressures also undermine the economy’s recovery.

Overseas shipments dropped 14.5% in dollar terms last month from a year earlier — the worst decline since February 2020 — while imports contracted 12.4%, the customs administration said Tuesday. That left a trade surplus of $80.6 billion for the month. Economists polled by Bloomberg had forecast that exports would drop 13.2% while imports would shrink 5.6%.

Shipments to the US plummeted 23.1% in July, according to the customs data. Exports to other markets including Japan, South Korea, Taiwan, Asean, the EU, Brazil and Australia all dropped by double digit percentages, too.

Global Weakness or Something Else?

China disguises some shipments to escape US tariffs by routing the trade through other counties making miniscule improvements.

So, shipments to the US may be down a bit less than stated.

But if that is happening to a huge extent, the trade data will soon show up elsewhere.

I suspect the bulk of this decline is genuine weakness for goods and the service economy will soon crack too, globally.

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