China's exports and imports declined by about three per cent in the first seven months amid falling global and domestic demand, according to data released by a ministry-level administrative agency here.
Foreign trade in the first seven months was three per cent lower than a year before, with exports down 1.6 per cent and imports down 4.8 per cent, figures released by General Administration of Customs (GAC) said.
Also exports and imports fell more than expected in July in view of persisting weakness in global demand following Brexit and other factors.
Exports fell by 4.4 per cent compared to a year earlier, which was a slight improvement over June's 4.8 per cent drop but still lower than analysts had been expecting.
Also imports fell 12.5 per cent from a year earlier, the biggest decline since February this year pointing to falling domestic demand despite a host of measures initiated by the government to halt the slowdown of the economy.
State-run Xinhua news agency, however, said exports in yuan-denominated terms rose 2.9 per cent year on year in July, while imports fell 5.7 per cent.
Yuan has declined by more than six per cent in the last several months after the first devaluation in September last year.
In US dollar denominated terms, exports fell to USD 184.7 billion while imports dropped to USD 132 billion. This leaves the country with a trade surplus of USD 52.31 billion for the month of July.
A 6-percent depreciation of the yuan against a basket of currencies over the past year has boosted exports to some extent, but there is still significant uncertainty about external demand, Xinhua quoted China International Capital Corporation (CICC) analyst Liu Liu as saying.
Export growth may stay low in the second half of the year, Liu said.
The accelerating fall in imports came amid weak commodity prices and higher comparative base from last year, but it also suggested domestic economic activity remained weak, said Jiang Chao, an analyst with Haitong Securities.
Jiang expected the exchange rate of the yuan to remain stable in short term.
The figures do "not bode well for the state of global demand, given that Chinese exports benefited from a weaker currency," Louis Kuijs of Oxford Economics was quoted as saying by BBC.
"Looking forward, we expect the trade data to remain lackluster in the coming months, given our outlook of subdued momentum in global trade and China's domestic demand," Kuijs said.
The sluggish domestic demand indicates that China's efforts to boost consumption to spur growth have yet to take effect.
China's economy grew 6.7 per cent year on year in Q2, aided by infrastructure investment, a housing boom and bank lending.
