China’s exports shrank much faster than expected in May and imports fell, albeit at a slower pace, as manufacturers struggled to find demand abroad and domestic consumption remained sluggish.

Exports from the world’s second-largest economy fell 7.5% year-on-year in May, the biggest decline since January and swinging from 8.5% growth in April.

Imports contracted 4.5%, a slower pace of decline in the previous month.

China’s factory activity shrank faster than expected in May on weakening demand, the official purchasing managers’ index (PMI) showed last week. The PMI subindexes showed factory output swung to contraction from expansion while new orders, including new exports, fell for a second month.

Having beaten expectations in the first quarter, analysts are now downgrading their expectations for the economy for the rest of the year, as factory output continues to slow amid persistently weak global demand.

The government has set a modest GDP growth target of around 5% for this year, after badly missing the 2022 goal.

Source: Qatar News Agency