China: Exports rebound strongly at the outset of the year

Exports rose 7.9% annually in January, contrasting the 6.1% drop recorded in December. The print exceeded the 3.2% rise that market analysts had expected and was the largest expansion in one year. China’s exports are benefiting from a weak yen and the recovery of global demand.

Meanwhile, imports rose 16.7% annually, which came in well above the 3.1% increase recorded in December. The print overshot the 10.0% expansion that market analysts had expected and represented the fastest increase since January 2013.

As a result of the strong rebound in imports, the trade surplus declined from USD 56.7 billion in January 2016 to USD 51.3 billion in January 2017. The 12-month moving sum of the trade surplus decreased from December’s USD 510 billion to USD 508 billion in January, which marked the lowest value since March 2015.

FocusEconomics Consensus Forecast panelists project that merchandise exports will expand 0.3% in 2017, while imports will rise 1.2%, driving the trade balance to a surplus of USD 539 billion. For 2018, the panel expects exports to expand 1.9% and imports to increase 2.7%, while the trade surplus will drop to USD 536 billion.