China Trade Surprise Signals Domestic Stimulus Focus: Economy

June 11 (Bloomberg) — China’s exports grew in May at more than double the pace analysts estimated while industrial output and retail sales trailed forecasts, signaling last week’s cut in interest rates was aimed at countering a domestic slowdown.

Overseas shipments climbed 15.3 percent from a year earlier, the customs bureau said yesterday, exceeding all 29 estimates in a Bloomberg News survey. Industrial output rose by less than 10 percent for a second month and retail sales increased the least in almost six years excluding holiday-month distortions, statistics bureau reports showed June 9.

China’s resilience in trade indicates Europe’s debt crisis has yet to produce a collapse in world commerce on the scale of the 2008 global recession, even as the plight of Spain’s banks threatens to deepen the trauma. Stronger exports and imports also support the case for Premier Wen Jiabao to adopt a more restrained stimulus than the credit boom that started in late 2008 and stoked a property bubble.

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