China’s import growth fell to a two-year low in
December, underscoring a slowdown in the fastest-growing major economy that
deepens risks for the global outlook.
Imports (CNFRIMPY) rose 11.8 percent
from a year before, less than all 21 estimates in a Bloomberg News survey of economists,
a government report showed on 10 January in Beijing. The moderation caused the
trade surplus to increase to $16.5 billion in the month, as exports advanced
13.4 percent in December.
Signs of domestic demand moderation bolstered
forecasts for monetary easing -- spurring a gain in local stocks -- as Europe
veers toward a recession and the International Monetary Fund prepares a “substantial” cut to its global growth
forecast. The widening surplus may give U.S. Treasury Secretary Timothy F.
Geithner ammunition to renew pressure for a stronger yuan
on a visit to Beijing on 10 January.
Slower import growth in China is bad news for
Australia, which counts on the nation as its biggest export destination and
last week reported that its trade surplus unexpectedly narrowed as shipments of
resources slowed. The Philippines said its exports slid 19.4 percent in November from a year earlier.
The euro region’s danger of a recession may be
reinforced by a report showing industrial production in France fell 0.2 percent in November from a month earlier.
U.S. Improvement
By contrast, U.S. data have signaled
improvement. Job growth picked up in December and consumer credit jumped by
$20.4 billion in November, reports in recent days showed.
Weakening import growth may undermine China’s
ability to lead the recovery as it did after the 2008 crisis. The nation’s
expansion may slide to 7.7 percent this quarter, the
slowest pace in three years, according to a UBS AG forecast.
Sportswear producers including Adidas AG are moving
some production to Central America to be closer to the U.S. market and as labor costs in China rise. Adidas, the world’s
second-biggest sporting goods maker, plans to increase its production in the
region fivefold by 2015, the company said last month.
The government’s fine-tuning policies may intensify
in response to the data, said Tim Condon, chief Asia economist at ING Financial
Markets in Singapore.
China’s central bank lowered the required reserve
ratio for banks for the first time in almost three years in December to
encourage lending, shifting its stance from fighting inflation as price
pressures eased.
Meantime, policy makers may also curb gains in the yuan even with pressure from abroad for it to strengthen.