China's September Exports Likely Rose 25.5% as Producer Prices Hit Fastest Since 2022
China's September exports likely rose 25.5%, while producer prices climbed 5%, the fastest since June 2022, CNBC reported.
The export forecast marked a modest pickup from the prior month, according to the poll. Imports for September were forecast to slow to 24.5% year-on-year growth from 28.2% in August. Earlier this year, China's exports and imports each grew at their fastest pace in five years.
China's producer price index climbed 5% in September, CNBC reported, higher than the 4.5% expected by economists polled by Reuters and sharply up from 3.8% in the previous month. Higher fuel prices pushed up costs for businesses. Consumer prices rose 0.9%, marginally missing expectations of 1% and up from 0.8% in the month before.
The inflation figures come as China's economy grapples with its lowest growth rate in more than three years. GDP growth for the second quarter missed expectations at 4.3%. While economic data for August showed retail sales expanded more slowly than expected, industrial output beat expectations.
On Sept. 28, a State Council readout signaled that more policy support could be on the way, saying that "countercyclical adjustments will be intensified in response to current problems in the economy." Lynn Song, chief economist for Greater China at ING, wrote that it marks a bit of a shift in tone, adding that more policy support rollouts will be coming to reach both short- and long-term growth targets. Those include the 4.5%-5.0% GDP growth target for 2026 and the longstanding goal to double GDP from 2020 to 2035.
A surge in demand for China-made parts for data centers to power artificial intelligence has helped fuel exports, along with stabilization in tensions with the U.S., China's largest trading partner on a single-country basis. Global scrutiny on the economic impact of China's surging exports has escalated in recent years amid sluggish domestic demand. AI-related demand and a coinciding rise in prices of core products have also helped support import growth.
The U.S. and China last month announced plans to roll back tariffs on $30 billion worth of goods from each country, and extend a broader trade truce by two months to January. The European Union last week announced China agreed to halve its exports of hybrid-powered cars to the bloc, following high-level trade talks in Beijing.