China's Exports Surge as Trade Tensions Near Boiling Point

China’s exports in May saw a significant increase, with a growth rate of 7.6% compared to the same period last year. This surge was driven by a high volume of shipments including appliances, cars, and electronics. Despite the fall in prices for many manufactured goods from China, the value of exports continued to rise. China’s strategy of expanding and building new factories to boost production has resulted in an increase in exports. However, weak spending from Chinese households, primarily due to declining apartment prices, has led to a decrease in domestic sales of appliances. As a result, appliance prices have dropped, and the number of exported appliances increased by 27.8% in May. China’s trade surplus also expanded in May to $82.6 billion, marking the highest level for May and one of the highest overall, except during the pandemic. The trade surplus is expected to rise further later in the year as exporters prepare for the Christmas season.