. Imports contracted 4.5%, a slower pace of decline than the 7.9% in the previous month. The figures compared with a Reuters poll that showed economists forecast a much smaller 0.4% decline in exports and an 8.0% fall in imports. The poor export performance reflects weak demand for Chinese goods as does the weak import performance as China brings in parts and materials from abroad to assemble finished products for export. South Korean data last week showed shipments to China slid 20.
“The weak exports confirm that China needs to rely on domestic demand as global economy slows,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management. “There is more pressure for the government to boost domestic consumption in the rest of the year, as global demand will likely weaken further in the second half.” China’s factory activity shrank faster than expected in May on weakening demand, the official purchasing managers’ index showed last week.
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