China’s economy remains solid, with exports up in July to a record, imports down, property prices falling, car sales strong, but easing and imports of iron ore ands copper both up on lows in June.
China’s trade surplus in July jumped to an 18 month high of $US28.7 billion from June’s $US20.02 billion as exports surged to a record for the month, and imports slowed.
July’s monthly surplus, the highest since January 2009, brought China’s cumulative surplus for the first seven months of the year to $83.93 billion.
Exports rose 38.1% to $145.5 billion, while imports grew a more muted 22.7% to $116.8 billion.
Imports fell because weakening domestic demand (cars, housing, whitegoods etc).
Chinese exports in June rose 43.9% from a year earlier and imports rose 34.1%.
The growth rate for exports beat an average forecast for a 35.5% climb tipped by Reuters, and the 36.3% increase expected by Dow Jones.
The pace of growth in imports was the smallest gain since growth resumed last November as the economy and demand picked up.
The trade surplus is the biggest since January 2009 and compares with $US20.05 billion in June and $US10.63 billion in July 2009.
China’s imports of iron ore in July rose 9% from June to 51.2 million tonnes.
It was the first rise in four months after three consecutive monthly declines to 47.2 million tonnes in June.
There were suggestions that imports from Australia and Brazil might have fallen, but were offset by increased purchases from India.
Total imports over the first seven months ending in July reached 360 million tonnes, up 1.5% from a year earlier
Iron ore imports in July were down 12% compared to the previous year, copper imports were off 16%, aluminium 70% and oil 3%.
Meanwhile, Chinese steel product exports slipped to 4.55 million tonnes in July, down 19% compared with June.
China cancelled export tax rebates on a number of steel products beginning in the middle of July which caused the fall.
Steel exports are expected to continue falling for the rest of the year.
China’s imports of unwrought copper and semi-finished copper products rose to 342,901 tonnes in July after having fallen 17.3% to 328,231 tonnes in June.
Imports of unwrought primary aluminium, alloy and semi-finished aluminium products declined to 67,462 tonnes in July (74,582 tonnes in June).
Exports of unwrought primary aluminium and alloy fell 4.7% to 68,786 tonnes in July compared with June’s 70,409 tonnes.
China’s alumina imports were 270,000 tonnes during July, with imports of 2.62 million tonnes in the first seven months of the year, down 20.4% on a year ago.
China’s property sector is still cooling with prices growth slowing to an annual rate of 10.3% in the year to July in the country’s 70 major cities.
The National Statistics Bureau said in an article in its in-house newspaper that the price slowdown came after a 19.3% fall in property sales last month.
The fall in the year to July in the rate of growth in house prices was well down on the 11.4% rate in June and 12.8% in April of this year.
China’s banking commission says it won’t be easing up on policies designed to cool the property market.
In fact lenders have been told to ‘stress test’ their loan books for a fall of 60% in the worst hit markets in the country.
The China Banking Regulatory Commission said last week that the stress tests don’t reflect the watchdog’s outlook on the nation’s real-estate market.
It’s more a way of telling the market and property companies and investors that thoughts of an easing in the restrictions on property purchases won’t be relaxed for a while yet.
The Statistics Bureau said that investment in real-estate development rose 37.2% to 2.39 trillion Yuan in the first seven months of 2010 from the same period of 2009.
That’s down from a 38.1% rate in the six months to June. July’s rise was 33% from July of last year.
Chinese car sales were solid, but easing in July from levels earlier in the year.
Figures out this week show that sales rose 17.2% in July, down from the doubling seen at the start of 2010.
Sometime in the next two months car sales could go negative as they started recovering strongly a year ago this month.
Sales this year are still forecast to top 15 million units – up around 20% on the 31.64 million units sold last year.
Passenger car sales in July rose 13.6% from a year earlier to 946,200 units and total vehicle sales were up 17.2%.
And in Japan, the Bank of Japan maintained interest rates and its monetary policy outlook after a meeting in Tokyo yesterday.
"Japan’s economy shows further signs of a moderate recovery, induced by improvement in overseas economic conditions," the central bank said.
"The employment and income situation has remained severe, but the degree of severity has eased somewhat."
The language was basically unchanged from the BOJ’s statement accompanying its July policy decision.
