China’s export growth is expected to have slowed to 1.9% year-on-year in April, a decrease from 12.4% in March. The March surge was influenced by exporters rushing shipments before new tariffs imposed by the U.S. took effect. Forecasts ranged from a decrease of 3.5% to an increase of 7.0%.

Imports are predicted to decline by 5.9% year-on-year, worsening from a 4.3% drop in March, indicating weak domestic demand. This decline is part of the broader impact of increased tariffs between the U.S. and China.

Us China Tariff Battle

The U.S. raised tariffs on China to 145%, and China has responded with tariffs up to 125% and restrictions on some U.S. goods. Preliminary trade talks between the U.S. and China are scheduled for Saturday in Switzerland.

These figures suggest a clear message: external demand for China’s goods may no longer be strong enough to prop up the gap in sluggish local consumption. In March, we saw a sharp jump in outbound trade, which was less about a fundamental boost and more about exporters racing the clock before new U.S. tariffs came into force. April tells a different story. The forecasted softening in exports to 1.9% growth brings expectations back down to earth, from what now seems like a temporary surge. With the wide forecast range—from negative to relatively healthy positive growth—it’s evident that forward-looking indicators aren’t offering much dependability right now.

Meanwhile, import figures continue to reflect soft activity at home. A steeper decline in inbound goods, with the estimate slipping further to a 5.9% year-on-year fall, shows consumers and producers are still pulling back. This tells us that business sentiment remains timid, possibly due to cloudy policy signals or simple caution following recent global uncertainties. The retreat in imports isn’t simply seasonal fluctuation—it’s a mirror of how much confidence remains absent in domestic purchasing behaviour.

The tit-for-tat tariff escalation, with the U.S. now applying up to 145% duties and reciprocal measures from China reaching as high as 125%, has made a noticeable dent. These aren’t mild shifts; these are figures that change sourcing dynamics, supply chains, and ultimately profit margins. When duties stretch that far, cross-border trade becomes a costly game of efficiency loss and re-routing. The addition of outright restrictions on select American goods expands the implications beyond just price; it introduces questions about longer-term market access and reliability.

Economic Impacts Of The Tariff Disputes

Talks planned in Switzerland this weekend might offer a temporary reprieve, but on their own won’t unwind pricing pressures or supply disruptions already set in motion. Any headlines from that meeting, while noteworthy, won’t instantaneously offset the operational shifts companies have already put into place. Positioning decisions mustn’t be based on hope or reports of progress alone, especially when the cost of being wrong rises with every new tariff or regulatory twist.

From our vantage point, what’s unfolding sets the stage for rethinking exposure to Asia-based trade-sensitive instruments. Volume may remain erratic, as traders adjust to the shifting sands of both fiscal direction and geopolitical bargaining. Thin liquidity and price gaps in highly levered assets could reappear, especially if domestic data from China keeps underwhelming or sentiment turns sharply with just one policy sentence from either side of the Pacific.

The economic signals are loud enough—this isn’t a time for passive observation. The data points to reduced global movement of goods, especially between the world’s two key economies, and margins become easier to squeeze in this kind of pricing backdrop.

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