China: Exports surge in January despite trade war worries
In January, exports expanded 9.1% over the same month last year, which contrasted the 4.4% drop in December. The print also contrasted the 3.3% decline that market analysts had expected.
Imports declined 1.5% in annual terms in January, coming in above the 7.6% drop recorded in December. The result overshot the 10.0% decline that market analysts had forecast.
The trade surplus rose from USD 18.4 billion in January 2018 to USD 39.2 billion in January 2019 (December 2018: USD 57.1 billion surplus). The 12-month moving sum of the trade surplus increased from USD 352 billion in December to USD 373 billion in January.
Analysts at Nomura comment that:
“The rebound in export growth was largely due to calendar effects related to the lunar new year (LNY) holidays (4-10 February this year; 15-21 February last year) as exporters may have front-loaded more shipments to January from February than last year. As such, the upside in January export growth is expected to result a much worse February print. Despite the January rebound, we believe the downtrend of export growth may resume shortly and continue in coming months, due to: 1) the ongoing payback effect from US-bound export front-loading; 2) weakening external demand and the global tech downcycle; and 3) RMB appreciation over the past few months.”