China’s export sector likely continued to expand strongly in October, according to a Reuters poll, providing a counterweight to lacklustre domestic demand even as a year-to-date trade surplus exceeding $1 trillion risks aggravating overseas concerns.
The poll’s median estimate is for goods exports to have increased 33.5% year-on-year in October in US dollar terms. That projection is marginally below September’s 36.3% jump. The full trade data were scheduled for release on Tuesday.
Analysts and poll respondents point to a global push to accelerate infrastructure for sophisticated artificial intelligence models as a primary factor lifting the value of China’s outbound shipments this year. Alongside exports, imports have been rising in value terms: the Reuters poll forecasts a 32.0% annual increase in October imports, following a 31.0% rise in September.
The median forecast in the poll is for a trade surplus of $125.8 billion for October, down from $133.53 billion in September. Even so, that level of surplus would be sufficient to take the trade balance for the first 10 months of 2026 to more than $1 trillion.
Observers warn that the growing surplus may heighten unease among trading partners. In the European Union, leaders have called for more robust measures to rebalance trade with China, and tensions with Washington remain elevated. The EU reached an agreement with Beijing last month to limit Chinese exports of hybrid vehicles to the bloc over the next few years. That curb has not yet taken effect, and exporters are expected to front-load shipments, which would tend to push up exports in the near term.
The strong export trend has helped keep China on course to meet the government’s annual GDP growth target of 4.5-5.0%. At the same time, domestic demand indicators remain weak. Household consumption continues to lag, weighed down by falling property values, fragile job security and subdued consumer sentiment.
Official figures released last month showed retail sales rose 1.1% year-on-year in September, underscoring the imbalance between external demand and domestic spending.
Manufacturing data paint a mixed picture. An official survey of factory activity indicated that conditions for manufacturers deteriorated in October compared with the previous month. The survey’s gauges for new orders and new export orders both recorded contractions.
Some market analysts flagged the decline in new export orders as a potential early sign of cooling demand tied to the AI technology cycle. "The deterioration in new export orders may provide an early warning of a softer AI tech cycle," said analysts at ANZ, while other analysts noted that the global AI boom could remain buoyant in the coming months.
Xu Tianchen, senior economist at the Economist Intelligence Unit, emphasised that certain hardware categories remain capacity-constrained. "Key hardware like printed circuit boards, memory chips, and optical transceivers are still facing capacity shortages, which will keep export momentum solid through the rest of the year," he said.
Overall, the poll suggests that external demand has been shouldering much of the burden of growth in an economy where household spending has yet to regain strength. How long export strength can compensate for weak internal demand, and how trading partners respond to an outsized surplus, will be central to China’s near-term economic outlook.