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Post-Pandemic Demand Triggers Chinese Trade Escalation

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Post-pandemic demand last month initially spurred a double-digit increase in trade between the U.S. and China, but consumers’ appetites are showing signs of slowing down, the Associated Press (AP) reported.

China’s trade with the U.S. and other parts of the world in April saw global exports go up 32.3 percent from 2019, hitting $263.9 billion. That figure aligns with March, but is a sharp decline from the 60.6 percent increase across January and February of this year. Imports escalated 43.1 percent to $221.1 billion from a 38.1 percent uptick in March, according to customs data, per AP.

Economists have said that the expansion is now flattening when taking into account the pandemic’s influence, global shutdowns and seasonal fluctuations. Last month’s boost in numbers is now being offset by the leveling off of export demand. 

Through April, Chinese exports went up 44 percent over the year prior, reaching $973.7 billion. Imports were also up $31.9 billion, reaching a total of $815.8 billion. However, worldwide shortages of processor chips caused a decline in China’s ability to manufacture goods like smartphones, cars, consumer electronics and other tech-driven merchandise. 

Julian Evans-Pritchard of Capital Economics said in a report that exports are now evening out, and that any import rebound has “stalled.” “Demand is probably close to a cyclical peak,” he added.

The outlook regarding the trade war between the U.S. and China is clouded and burdened by the fact that President Joe Biden has yet to mention when talks to end the conflict would continue, according to AP. 

Retail sales last month escalated 23 percent from a year ago, according to the Mastercard SpendingPulse. The report also indicated that eCommerce was a bigger percentage of retail activity last month, accounting for 21.6 percent. Those results align with PYMNTS’ Global Shopping Index, which surged 60 percent in purchases made by digital devices since March 2020.

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