Photo used for illustrative purpose.

China’s export growth slowed in October but beat forecasts as booming global demand for holiday seasons, an easing power crunch and mitigating supply chain disruptions offset some pressures facing the world’s second-largest economy.

Imports, however, missed analysts’ expectations, likely pointing to the overall weakness in domestic demand.

Outbound shipments jumped 27.1 per cent in October from a year earlier, slower than September’s 28.1 per cent gain. Analysts polled by Reuters had forecast growth would ease to 24.5 per cent.

Zhiwei Zhang, chief economist at Pinpoint Asset Management, said the strong exports would help to mitigate the weakening domestic economy, and offer the government with more room to manoeuvre economic policy.

“The government can afford to wait ‘til the year end to loosen monetary and fiscal policies, now that exports provide a buffer to smooth the economic slowdown,” he said.

Recent data has pointed to a manufacturing slowdown. Factory activity shrank for a second month in October, an official survey showed, while growth in industrial output eased to the lowest since March 2020 - the first wave of the pandemic.

However, under heavy government intervention, some supply constraints have started to ease in recent weeks. A power crunch - triggered by a shortage of coal, tougher emission standards and strong industrial demand - has started to ease after heavy government intervention. Premier Li Keqiang said on Tuesday that China’s government will take measures to support the industrial sector as the economy faces renewed downward pressures.

Imports jumped 20.6 per cent in October from a year earlier, accelerating from a 17.6 per cent gain in September but missing the expectations for a rise of 25%.

China’s crude oil imports plunged in October to their lowest since September 2018, while coal imports slowed as domestic production boomed. Purchases of iron ore slipped for a second month on easing demand.

China posted a trade surplus of $84.54 billion last month, above the poll’s forecast of $65.55 billion and September’s $66.76 billion surplus.

The country’s economy grew 4.9 per cent in the July-September quarter from a year earlier, the weakest reading since the third quarter of last year.

China’s trade surplus with the United States was $40.75 billion in October, Reuters calculations based on customs data showed, down from $42 billion in September.

US Trade Representative Katherine Tai pledged last month to exclude some Chinese imports from tariffs while pressing Beijing over its failure to keep some promises made in a “Phase 1” trade deal made under the Trump administration.

China’s foreign exchange reserves in October rose on a monthly basis for the first time since July, official data showed on Sunday, as the dollar slipped against a basket of other major currencies.

China’s reserves, the world’s largest, reached $3.218 trillion at the end of October, up 0.53% from a month earlier, according to data from the State Administration of Foreign Exchange (SAFE).

That was higher than the $3.197 trillion forecast in a Reuters poll of analysts and up from $3.128 trillion in October 2020.

However, it remains lower than the $3.232 trillion at the end of August.

The dollar index dropped by 0.1 per cent in October.

“Despite the recurring COVID-19 pandemic and uncertainties among global economic recovery...China’s economy continues to recover with strong resilience and huge potential, which would provide support for maintaining overall stability in the scale of foreign exchange reserves,” the SAFE said in a statement on Sunday.

China held 62.64 million fine troy ounces of gold at the end of October, unchanged from the previous month of 62.64 million fine troy ounces.

The value of its gold reserves edged up to $110.83 billion from $109.18 billion at the end of September as gold prices rose.

China’s crude oil imports plunged in October to the lowest since September 2018, as large state-owned refiners withheld purchases because of rising prices while independent refiners were restrained by limited quotas to import.

The world’s biggest crude oil importer brought in 37.8 million tonnes last month, data from the General Administration of Customs showed on Sunday, equivalent to 8.9 million barrels per day (bpd).

That is down from 9.99 million bpd in September and 10.02 million bpd in the same period last year.

Over the January-October period, crude arrivals totalled 425.06 million tonnes, or 10.21 million bpd, down 7.2% year-on-year, the customs data showed.

Crude imports were down on a monthly basis for a second month and the decline has occurred amid a 62% jump in crude oil prices this year as economies open globally from COVID-19 pandemic restrictions, spurring fuel demand.

Beijing’s crackdown on illicit trading in crude oil quotas and import allowances for independent oil refiners also weighed on purchases.

Customs data on Sunday also showed China’s refined oil product exports for October fell 31.8% on-year to 3.95 million tonnes.

Natural gas imports, including piped and liquefied natural gas (LNG), were 9.38 million tonnes in October, up 24.6% from a year earlier.

Oil imports may be set to rise in November as refiners have vowed to address a shortfall in diesel and gasoline supplies that has pushed fuel prices higher.