Exports in March shot up 14.8% from a year ago, snapping five straight months of declines and stunning economists who predicted a 7.0% fall in a Reuters poll.
But analysts say the jump was more likely related to exporters rushing to fulfil a backlog of orders that had been disrupted by the pandemic in past months, and warned the global demand outlook remained subdued.
“The wave of COVID outbreaks in December and January likely depleted factories’ inventories. Now that factories are running at full capacity, they caught up the cumulated orders from the past,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management.”
“The strong export growth is unlikely to sustain given the weak global macro outlook,” he added.
Meanwhile, imports fell less than expected, with economists pointing to an acceleration in the purchase of agricultural products, especially soybeans, as providing some support.
Imports dropped just 1.4%, smaller than the 5.0% decline forecast and a 10.2% contraction in the previous two months. Increases in crude oil, iron ore and soybeans imports in the month were offset by a decline in copper imports.
Financial markets took little cheer from the upbeat export data as investors remained wary about the outlook, although the Australian dollar, seen as a proxy for Chinese demand for commodities, rose slightly.
Lv Daliang, spokesperson of the General Administration of Customs, attributed the upside surprise to strength in demand for electric vehicles, solar products and lithium batteries.
However, he warned conditions could worsen going forward.