Exports hit a record high of $162 billion in June, while imports for the month were $139.7 billion. That left the country with a trade surplus of $22.3 billion in June, compared with $13.1 billion in May.
What is more frightening is how Reuters words their report. Because China once again dominates trade with exports, Reuters tries to claim their economy is softening. This is because China's imports were way below expectations, but imports do not imply weak China domestic consumer demand. Why? Unlike the U.S., Consumer spending is only about 35% of China's GDP. They save and invest, not spend money buying imports.
What the lack of imports really means is the United States exports to China are not materializing. What investors are really worried about is China's cheap labor market disappearing through inflation and finally the yuan being forced to appreciate due to the flood of cash pouring in from their exports.
About the only real indicator of a weakening consumer component is the slow down of auto sales in China. Bear in mind China has tariffs on oil imports.
the overall sales growth rate was still 29 percentage points lower than that of the same period last year
But for you and me, us working folk, wishing China would import U.S. goods and somehow their refusal to do so would implode their economy is a pipe dream at best.
What this news also means for your and me is bad news for Q2 GDP. That's United States GDP. The United States is China's number one export destination, which odds on means the U.S. imported massive China goods, which detracts from U.S. GDP. Amazing how the press kind of ignores this, like the GDP equation itself.
On a side note, the WTO ruled against China for limiting it's rare earth materials exports. We'll see if that matters since China seems to do what it wants and gets away with pretty much everything.