China's Trade Turmoil: Economic Pressures Mount Amid U.S. Tensions

China witnessed a sharp slowdown in export growth last May, reaching a three-month low amid the ongoing U.S. tariffs, increasing pressure on its already strained economy. Factory-gate deflation hit a two-year worst level, complicating an economic landscape further disrupted by the global trade war.

Customs data showed that while May's export value grew by 4.8% year-on-year, this was a decline from April's 8.1% increase, and missed expectations. Imports declined by 3.4%, a significant drop from the previous month's 0.2% decrease, highlighting weakened domestic demand and the global trade tensions.

Negotiations between China and the U.S. continued, reflecting tensions over trade issues including rare earth exports. As China's critical trade surplus rose to $103.22 billion, Beijing enacted stimulus measures to shore up its pandemic recovery, facing challenges from deflationary pressures and subdued consumer demand.

(With inputs from agencies.)