China wraps up 2023 with more deflation and a trade slump

China’s economy had a tough 2023 and the outlook remains uncertain. Exports for the year fell for the first time since 2016 due to global demand slowdown, excluding cars. The country is also grappling with deflationary pressures, with consumer price inflation at its weakest in 14 years. China is facing weak demand both domestically and internationally. In 2023, exports dropped by 4.6% compared to the previous year, and imports fell by 5.5%. However, there was a slight improvement in December, with exports rising 2.3% compared to the same period last year. Trade with Russia reached a record high, while the U.S. remained China’s largest trading partner. Despite challenges, China experienced a surge in automobile exports, particularly in the electric vehicle market.