Recent economic data from China and the United States highlights a complex global landscape, where trade resilience and domestic labour market concerns are shaping investor and business sentiment.
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China's exports grew by 8.3% year on year in September, exceeding expectations, while imports surged to a 17-month high, demonstrating the country's ability to offset US protectionist measures with demand from other regions. Exports to the US fell sharply (-27.0%), but strong growth was recorded for the EU (14.2%), ASEAN (15.6%), Africa (56.6%) and Latin America (15.2%). Key growth sectors included ships (42.7%), semiconductors (32.7%) and automobiles (10.9%), while categories exposed to the US, such as apparel (-8.0%) and toys (-27.9%), underperformed.
Chief Economist, Greater China, Lynn Song noted, "Despite taking a notable hit on the aggregate level, various specific exports to the US remain sticky given limited alternatives. Global tariff uncertainty has also led to more caution when it comes to setting up alternate factory locations. Consequently, we continue to expect that external demand should remain an important driver of growth for the rest of the year."
Meanwhile, in the United States, consumer sentiment remains subdued amid growing concern over job security. The University of Michigan preliminary consumer sentiment index for October fell to 55.0, with 63% of households expecting rising unemployment over the next 12 months. Chief International Economist James Knightley said, "The labour market is weak and that's the punchline for policy. All the jobs surveys are telling you the same story." He anticipates the Federal Reserve will continue with 25bp rate cuts in October and December, followed by a further 50bp of cuts in early 2026.
Taken together, the data paints a cautious picture: China's external demand is offsetting some trade risks, yet US domestic anxieties could weigh on growth. Markets and policymakers will closely monitor these developments as they navigate tariffs, trade tensions, and labour market pressures.
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