China unexpectedly posted a trade surplus in March, as import growth slowed significantly despite government's efforts to shift towards domestic consumption-led economic growth.
The latest figures from the General Administration of Customs showed Tuesday that trade balance was in a surplus of $5.35 billion in March compared to a $3.15 billion deficit expected by economists.
In February, the balance was in a deficit of $31.48 billion, the first shortfall in a year and the highest since 1989.
During March, exports surged 8.9 percent year-on-year, faster than the expected 7 percent growth. This was nonetheless, weaker than the 18.4 percent annual growth reported for February.
At the same time, imports rose 5.3 percent, weaker than the 9 percent expansion forecast by economists. This was sharply slower than February's 39.6 percent expansion.
The Chinese economy expanded 8.9 percent in the fourth quarter, the slowest pace in more than two years as a result of sluggish external demand. The economy would have expanded 8.4 percent in the first quarter of 2012, Zhang Xiaoqiang, a senior official with the National Development and Reform Commission said last week.
The National Bureau of Statistics is slated to release the first quarter GDP figures on Friday and economists forecast an 8.4 percent growth for the period.
The latest purchasing managers' survey results for the manufacturing sector indicated a possible slowdown in economic growth during the first three months of this year. According to the survey, China's manufacturing sector shrank for a fifth consecutive month in March, amid a combination of sluggish export new orders and softening domestic demand.
In its latest policy easing move, the People's Bank of China cut the reserve requirement rate for all commercial banks by 50 basis points for the second time in three months in February to boost lending amid sluggish economic growth.
Despite softening economic activity, the central bank refrained from an interest rate reduction this year due to persistent inflationary pressures. According to official data released yesterday, inflation rebounded to 3.6 percent in March from a 20-month low of 3.2 percent in February, dimming the prospects of further monetary easing.
China now targets 7.5 percent economic growth this year, lower than the previous target of 8 percent. The economy expanded 9.2 percent in 2011 and 10.4 percent in 2010.
by RTT Staff Writer
For comments and feedback: email@example.com
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.