Merchandise exports fell 0.4% annually in October, contrasting September’s 5.7% rise and market expectations for a 4.3% gain. The contraction was driven by softening goods demand in developed markets—particularly the U.S. and Europe—and Covid-19-related supply disruptions at home. October’s result marked the largest decline since May 2020. Meanwhile, merchandise imports fell 0.7% in annual terms in October (September: +0.3% yoy), marking the weakest reading since August 2020 and indicative of weak domestic demand.
As a result, the merchandise trade balance improved from the previous month, recording a USD 85.2 billion surplus in October (September 2022: USD 84.7 billion surplus; October 2021: USD 84.8 billion surplus). Lastly, the trend improved, with the 12-month trailing merchandise trade balance recording a USD 895.7 billion surplus in October, compared to the USD 895.3 billion surplus in September.
Exports are expected to decline over the next few quarters as the slowdown in developed markets intensifies.