China's economy showed signs of recovery in June, driven by a notable rebound in exports to the United States and a surge in freight rates to their highest levels in nearly two years, according to the China Beige Book and S&P Global [1]. The China Beige Book, based on a survey of 1,321 businesses conducted from June 1 to 22, reported clear improvements in manufacturing and a recovery in retail sales, particularly in luxury goods, though tourism-related spending remained weak [1].
After losing momentum in April and May—when retail sales fell for the first time since the pandemic and the 618 shopping festival saw a sharp slowdown in sales growth—factory activity accelerated in June. U.S.-bound export orders saw sharp year-on-year gains, with China's exports to the U.S. growing by 11.3% in April and 35.4% in May, reversing the double-digit declines experienced for most of the previous year [1]. Official data indicated that China's exports to the U.S. in May reached nearly 90% of 2024 levels, compared to just 70% in May 2025 [1].
Freight rates for shipping between Asia and the U.S. have surged, attributed to importers frontloading shipments ahead of anticipated higher fuel surcharges and price hikes from Asian suppliers. S&P Global noted that this stockpiling could taper off by late July [1]. While export order growth to Asia and other developing countries slowed in June, growth to Europe remained steady [1].
On the policy front, a recent meeting between former President Donald Trump and Chinese President Xi Jinping signaled that tariffs would likely remain lower for now, with the 10% duty on goods from most major trading partners set to expire on July 24. However, businesses are rushing to ship goods before potential new tariffs are imposed, as the U.S. has yet to implement additional duties that could arise from ongoing Section 301 probes [1].
Analysts, including Tianchen Xu from the Economist Intelligence Unit, noted that China's weak economic momentum likely turned around in June, but emphasized that sustained improvement in July and August is necessary for a more definitive recovery [1].
CONCLUSION
China's economy experienced a rebound in June, led by a surge in U.S.-bound exports and higher freight rates. While the recovery marks a positive shift from earlier months, analysts caution that continued improvement in the coming months is needed to confirm a lasting turnaround. Market participants are closely watching tariff developments and export trends for further signals.