Exports out of China experienced a contraction during the month of May as the world continued to remain in various states of lockdown as a result of the coronavirus crisis, even as imports showed a greater than expected decline for the period. According to customs data, overall shipments declined by 3.3% YoY in May after having risen by 3.5% in the previous month.

However, the extent of contraction was less severe than economists’ forecast, which was for a 7% decline. On the other hand, however, imports into China fell by 16.7% YoY during May, worse than the 14.2% drop seen in April and well below economists’ expectations for a 9.7% decline.

China’s trade reliant economy posted its highest trade surplus seen since at least 1981 on account of the steep fall in imports. The trade surplus for the month of May touched $62.93 billion, vs. $45.34 billion in April and $39 billion forecast.

China’s trade is expected to remain under strain in the near future as external demand is likely to take longer to recover as the pandemic undermines consumption levels in most parts of the world. Additionally, US-China trade tensions are back in the spotlight, which could keep exports from China under pressure.