China's exports and imports expanded at a faster pace in May, topping forecasts. Exports rose 19.4% from a year earlier, an acceleration from April's 14.1% increase. Imports also jumped, growing 27.4% compared to April's 25.3% year-on-year expansion.
The performance was supported by booming demand for artificial intelligence hardware, semiconductors, and autos. This surge in global AI investment helped the world's top manufacturer offset disruptions and export hits expected from the war in Iran and Middle East turmoil. Additionally, front-loading by overseas buyers to pre-empt Gulf war energy costs contributed to the increase in shipments.
Despite these gains, trade with the United States contracted further following steep tariffs imposed by President Donald Trump. From January to May, exports to the U.S. fell 2.7% while imports dropped 5.5%. The acceleration in export growth provides a vital lifeline to an economy that has shown signs of faltering after a strong first quarter and remains bogged down by a persistent domestic slowdown.