China Records $100B Trade Surplus in May Despite Falling Imports and Persistent Deflation

Optimized Article for Tredu.com

China Records $100B Trade Surplus in May Despite Falling Imports and Persistent Deflation

China’s export sector outperformed expectations in May 2025, contributing to a record trade surplus of over $100 billion, according to data from Bloomberg. Despite this strong showing, the country continues to face deflationary headwinds, complicating its broader economic outlook.

Exports Beat Expectations, Imports Lag

Chinese exports rose by 4.8% year-on-year in US dollar terms, slightly below the 6% consensus forecast. However, imports plunged by 3.4%, significantly underperforming expectations and signaling weakening domestic demand.

Also read: Why Chinese Imports Are Falling Despite Global Trade Recovery

Record-High Trade Surplus

The trade surplus in May exceeded $100 billion, bringing the 12-month rolling surplus to a record $1.13 trillion. When calculated in Chinese Yuan (CNY), the surplus reached 743 billion, the third-highest figure on record.

This widening surplus indicates robust external demand for Chinese goods but also reflects sluggish internal consumption and weak investment—hallmarks of a deflationary environment.

Deflation: An Ongoing Challenge

Despite the headline trade numbers, China continues to grapple with deflation, driven by weak domestic demand and declining producer prices. Analysts warn that without strong internal growth, reliance on exports alone may not be enough to sustain recovery.

Related: How Deflation Impacts China’s Long-Term Growth Prospects

Key Takeaways

• Chinese exports rose 4.8% YoY in May 2025.
• Imports fell 3.4%, indicating weak domestic demand.
• Monthly trade surplus surpassed $100 billion.
• 12-month surplus reached a record $1.13 trillion.
• Deflationary pressures continue to cloud China's outlook.