CHINESE exports expanded faster than expected in October, providing support for the recovering economy and driving increasing demand for imports, which rose for a second straight month.

Exports increased 11.4 percent in dollar terms in October from a year earlier, while imports gained 4.7 percent, the customs administration said Saturday. That left a trade surplus of US$58.4 billion for the month. Economists had forecast that exports would increase by 9.2 percent while imports would grow by 8.6 percent.

China’s economic recovery likely continued in October, with early data showing ongoing expansion in manufacturing and a pickup in the services industry.

Strong exports have been a major support to that recovery due to international demand for things like medical gear and equipment for people to work at home. There may also be a boost from re-openings in other countries, although that may fade away as major economies return to virus lockdowns.

“We expect China’s export to remain robust,” Citi economists led by Liu Ligang wrote in a report before the data, “slowed by high base last year but continuing to benefit from the recovery of global demand before the recent surges in COVID-19 cases in Europe and the United States.”

Imports growth likely suffered from fewer working days in the month. However, China is expected to continue ramping up agricultural and energy imports from the United States in order to meet the targets set in the trade deal inked in January. Recovering domestic demand also likely helped support the solid growth.

China’s trade surplus with the United States widened to US$31.37 billion in October from US$30.75 billion in September.

China’s exports have stayed largely resilient amid the COVID-19 global pandemic, as strong demand for medical supplies and reduced manufacturing capacity elsewhere worked in China’s favor.

“Exports growth quickened further and significantly exceeded expectations, indicating a relatively strong momentum,” said Liu Xuezhi, an analyst at Bank of Communications.

China’s exports could stay strong in the rest of 2020 as domestic firms resume production faster than global rivals and sell more COVID-19 related goods such as face masks, Liu said.

However, some analysts said exports could come under pressure in the coming months, as major European economies, including France, Germany and the United Kingdom, went back into lockdown as a second wave of coronavirus cases gathered strength.

Factory activity expanded at the fastest pace in nearly a decade in October, a private survey showed, although the official survey pointed to some slowdown in the expansion. Export orders rose.(SD-Agencies)