China's Exports Unexpectedly Shrink
China’s export unexpectedly fell to 0.3 percent in September compared with the year-ago period due to a sign of weakening global demand for its products and a potential headwind for the world's No. 2 economy. The drop in exports was mainly with volumes to the European Union, Hong Kong and Taiwan. Compared with a year earlier, China's exports to Hong Kong slipped 4.1%, while exports to Taiwan decreased 8.6% and exports to the European Union fell by 1.1%. However, exports to the U.S. rose 4.2% and to Japan rose 1.3%.
Steel exports fell to 3.68 million tons made them to the lowest level since February. Moreover, global steel demand compared to the previous two months remains bearish and will also effect in the long-term.
Moreover, China's key manufacturing sector faces challenges despite signs of slightly accelerating growth in the Chinese economy in the second half of this year. China's economy showed slower growth of 7.7% year-over-year in the first quarter and 7.5% in the second quarter, initially raising fears that the expansion might fall short of the government target of 7.5% for the full year. China's trade surplus narrowed in September to $15.2 billion from $28.52 billion in August.