China's Imports Crash to Near Zero

The growth rate for the value of goods that a country imports is a good indicator of the relative health of the nation’s economy. If the year over year growth rate of imports is positive, it generally tells us that the country’s economy is expanding. If it’s negative, it tells us that the nation’s economy is likely contracting. And if it’s near zero, it tells us that the importing nation’s economy has stalled out.

With that in mind, in April 2014, China’s economy appears to have largely stalled out:

The data in this chart is based on data published by the U.S. Census Bureau, which measures the value of goods exported by the U.S. to other nations and also the value of goods imported into the U.S. As such, this data is generally considered to be considered to be of higher quality than that published by China’s government.

Speaking of which, it would appear that the data that the Chinese are reporting for the value of goods imported into China fell in May 2014.

So if the year over year growth rate of China’s imports/economy was at near zero levels in April 2014, and then continued to fall in May, that suggests that China’s economy is experiencing recessionary conditions, at the least, or an outright recession, at worst.

We’ll have to wait a month to see what the Census Bureau reports for May 2014 to confirm which scenario applies.

Data Sources

U.S. Census Bureau. Trade in Goods with China. Accessed 9 June 2014.

Board of Governors of the Federal Reserve System. China / U.S. Foreign Exchange Rate. G.5 Foreign Exchange Rates. Accessed 9 June 2014.