China Sees Poor Export, Import Growth in July
Created: 2012-08-10 13:23 EST
China's economic figures for July are in, and they're not looking good. This furthers fears that the Chinese economy may be faltering.
Export growth in July slumped to just 1% year on year, China's Custom's Bureau announced on Friday. It's a massive drop from 11.3% in June, and well below market expectations.
Imports in July slowed, too. They grew at just 4.7%, down from 6.3% in June. Coupled with a drop in the Consumer Price Index and the Producer Price Index, this suggests that domestic demand is not picking up.
[Frank Tian Xie, Assistant Professor of Marketing, University of South Carolina Aiken]:
"The public has an overall sense of unease about their economic future so they're holding back. This leads to a sluggish market."
Chinese authorities have been easing monetary policy to boost internal spending, but those measures may not be working.
Bank lending in July dropped by more than 40% from June, to just 540 billion Yuan, or around 85 billion US dollars. That's despite a double rate cut between June and July.
Still, analysts expect regulators to introduce further measures to boost the economy, including more cuts to banks' reserve ratio. Another interest rate cut could also be on the horizon.