The latest survey by China Beige Book indicates a significant slowdown in U.S.-bound shipments from China, with the number of exports falling outright for the first time since March. This decline is particularly notable given that shipments to the U.S. had previously surged by 14% in June, contributing to an overall export increase of 27%, the highest in nearly five years.
The drop in July coincides with a broader deceleration in factory activity and worsening employment across all surveyed sectors. Retail sales also experienced a decline, highlighting a downturn in consumer spending, particularly in travel and restaurants.
Chinese policymakers have responded by emphasizing the need to boost domestic demand and enhance international trade cooperation, indicating a strategic shift to mitigate the impact of declining exports. Upcoming trade data for July, along with retail sales and investment figures, will provide further insights into the economic landscape