BEIJING – China’s export growth in July outpaced market forecasts, rising 7.2% year-on-year in U.S. dollar terms, according to official customs data released Thursday. The figure surpassed the 5.4% rise expected by economists polled by Reuters and marks continued resilience in external demand despite uncertainty around trade relations with the United States.
At the same time, imports climbed 4.1%, registering the largest increase since July 2024, according to LSEG data. The rebound in imports came after a 1.1% rise in June, defying market forecasts of a 1.0% decline in July.
On a year-to-date basis, exports are up 6.1%, while imports have declined 2.7% compared to the same period in 2024.
“China’s exports have supported the economy strongly so far this year,” said Zhiwei Zhang, President and Chief Economist at Pinpoint Asset Management, who noted that the recent export momentum may soon ease as companies complete front-loaded shipments ahead of possible tariff changes.
China’s trade surplus through July reached $683.5 billion, which is 32% higher than the same period a year earlier, reflecting continued strength in outbound shipments and lagging domestic demand recovery.
Manufacturing momentum weakens
Despite strong trade figures, China’s domestic manufacturing activity showed signs of weakness. The official Purchasing Managers’ Index (PMI) for manufacturing fell to 49.3 in July, down from 49.7 in June, missing expectations for a flat reading and signaling a three-month low in factory performance.
The PMI drop indicates contraction in the manufacturing sector, raising concerns about whether external demand alone can sustain China's growth trajectory amid softening internal consumption and private investment.
Tariff truce countdown
The strong trade performance comes as the U.S.-China tariff truce is set to expire on August 12, with no final agreement yet reached between Washington and Beijing. Talks between negotiators continue, but triple-digit tariffs on hundreds of billions of dollars in goods remain on the table if a new deal is not secured.
The potential lapse in the truce poses risks to both economies, particularly for export-reliant manufacturers in China and U.S. importers facing increased costs. Analysts warn that the current pace of export front-loading by Chinese firms may taper off once clarity emerges on the trade deal outcome.
