China's surprise drop in imports sparks worries over domestic demand

November data dashes hopes of a rebound to drive growth

SHANGHAI - China's imports unexpectedly shrank in November from a Covid-19-hit period one year ago, dashing hopes domestic demand would rebound from a low base to spur growth in the world's second-largest economy.

Imports in US dollar terms declined 0.6 percent after clocking an improvement the previous month, according to official data released on Dec 7. That was much worse than economists' consensus forecast of a 3.9 percent gain.

Exports rose 0.5 percent from a year ago, slightly better than the consensus estimate of no change, and marked the first year-on-year expansion since April. The resulting trade surplus was US$68.39 billion (S$91.75 billion).

"Domestic demand is not really improving, even as we compared it with a low base last year," said UOB economist Ho Woei Chen. "There is also no discernible improvement trend in exports despite a slightly better-than-expected export growth in November.