China posted a surge in exports and imports in June. In its fourth successive month of growth China’s exports increased11.3 per cent year-on-year in dollar terms and imports were also strong, with year-on-year growth of 17.2 per cent. Exports to the US, EU and Japan were the main reason for the acceleration as they rose 15.8 per cent compared with 9.7 per cent in May. Exports to non-G3 countries were relatively sluggish at 4.7 per cent compared with growth of 2.8 per cent in May.

June’s exports were driven by sharp improvements in electronics and machinery and high-tech products while exports of labor-intensive goods such as toys, garments and furniture were up 6.2 per cent. China has been performing better than expected, fuelling hopes the world’s top trader in goods and a key driver of global growth was stirring after a years-long growth slowdown.

However, there are indications of slowing growth in the Chinese economy as it deals with weaker demand and excess industrial capacity left over from a debt-fuelled infrastructure boom. China’s economy expanded last year at its weakest rate in more than a quarter of a century. Weak growth is a major concern for policymakers who prefer stability and it complicates their efforts to retool the economy into one driven by consumer demand rather than state investment and exports.