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China: Merchandise exports grow at a milder pace in May
Latest reading: Merchandise exports climbed 4.8% on an annual basis in May, on the heels of April’s 8.1% rise and slightly below market expectations. Exports to the U.S. plunged by over a third due to U.S. tariffs, though this was more than offset by higher exports to other locations; some goods bound for the U.S. were likely rerouted via third countries to avoid tariffs. Meanwhile, merchandise imports decreased 3.4% over the same month last year in May (April: -0.2% yoy).
As a result, the merchandise trade balance improved from the previous month, recording a USD 103.2 billion surplus in May (April 2025: USD 96.2 billion surplus; May 2024: USD 81.4 billion surplus). Lastly, the trend pointed up, with the 12-month trailing merchandise trade balance recording a USD 1127.1 billion surplus in May, compared to the USD 1105.3 billion surplus in April.
Panelist insight: On the latest data and outlook, Nomura analysts said:
“The miss in exports is not a big surprise to us, as the substantial tariff swings in April-May make forecasting monthly trade data challenging. We have been stressing that the boost from the US tariff rollback should be more significant in June, as it might take a couple of weeks to restore the logistics network that was disrupted by what had nearly become a US-China trade embargo. The sharp recovery in container bookings and freight rates indicate an incoming rebound in US-bound exports in June. However, significant payback is likely to surface after the 90-day truce period ends in mid-August.”
