Left Menu
Development News Edition

UPDATE 1-China Jan trade data beats forecasts, but likely due to seasonal factors


UPDATE 1-China Jan trade data beats forecasts, but likely due to seasonal factors
China's exports unexpectedly returned to growth in January after a shock decline the previous month, while imports fell much less than expected, but analysts said it was likely due to seasonal factors and predicted renewed trade weakness ahead. Global investors and China's major trading partners are closely watching to see how quickly its economy is cooling, or if a spate of support measures announced last year are beginning to take hold, lifting some of the gloom hanging over the world economy.

January exports rose 9.1 percent from a year earlier, customs data showed on Thursday. Economists polled by Reuters had expected a 3.2 percent drop after a 4.4 percent decline in December. Imports fell 1.5 percent from a year earlier, much better than analysts' forecasts for a 10 percent fall and narrowing from December's 7.6 percent drop.

That left the country with a trade surplus of $39.16 billion for the month, better than forecasts of $33.5 billion Analysts warn that data from China in the first two months of the year must be treated with caution due to business distortions caused by the long Lunar New Year holidays, which fell in mid-February in 2018 but started on Feb. 4 this year.

"Clearly, the numbers surprised the market on the upside. But given the deceleration of global PMI and the weak Korean trade data, it might be pre-mature to conclude that the trade prospect has improved just based on the January number alone," said Tommy Xie, China economist at OCBC Bank in Singapore. "I suspect that the recovery may be partially due to the Chinese New Year effect as this year's CNY is slightly earlier as compared to last year."

Economists had widely tipped that China would see weaker exports early this year. Factories have reported shrinking overseas orders for months and warehouses in America are packed to the rafters with Chinese goods that retailers stockpiled last year in anticipation of more U.S. tariffs. Trade globally has also been faltering amid rising protectionism and a loss of momentum in some major economies, most notably in Europe.

Pressure on China will escalate quickly if Beijing and Washington cannot reach a deal soon to end their year-long trade war. The U.S. is set to sharply raise tariffs on $200 billion worth of Chinese imports from March 1, though President Donald Trump said this week he could let the deadline "slide for a little while" if a deal appears close. China's trade surplus with the United States narrowed to $27.3 billion in January, from $29.87 billion in December, customs data showed on Thursday.

Exports to the United States fell 2.4 percent in January from a year earlier, while imports from the United States plunged 41.2 percent. Net exports actually dragged on China's growth by 8.6 percent last year, even after the unexpected jump in sales to the U.S., Reuters calculations based on official data showed.

Factory surveys have also show weakening domestic orders, and broader economic weakness is taking a toll on both business and consumer confidence. Retail sales during the Lunar New Year holiday rose 8.5 percent from a year earlier, still solid but the slowest pace since at least 2011. China's economic growth slowed to 6.6 percent in 2018, weighed down by rising borrowing costs and a clampdown on riskier lending that starved smaller, private companies of capital and stifled investment.

(Reporting by Lusha Zhang, Stella Qiu and Kevin Yao; Editing by Kim Coghill)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

Download The Devdiscourse News App for Latest News.


TRENDING

OPINION/BLOG/INTERVIEW

WEF 2020: Trump seems politically correct in pulling out from Paris Agreement

If the survey of the World Economic Forum WEF is believed, Trump seems to enjoy the confidence of his people in flaying climate intuitions and climate activists. His preference for economic development over environmental protection not only...

From home to healthcare, here are Robotic innovations transforming lives

Lovot is equipped with more than 50 sensors such as thermography, microphone array, obstacle detection, and touch sensor to generate motion and emotions in real-time....

Translating words to deeds: Achieving gender parity in access to financial resources

... ...

SDG13: How you can reduce global warming by changing your food habits

The mega narratives of various international organizations give the impression that fighting global warming is only a job of government agencies. However, the European Investment Bank EIB has designed a questionnaire which besides making th...

Videos

Latest News

Seven Mali soldiers killed in overnight ambush

Seven soldiers were killed and several were wounded in an overnight attack in central Mali, the government said Thursday, in fresh violence in the war-torn West African state. The troops came under fire late Wednesday from unidentified arme...

Pak violates ceasefire along LoC in J-K's Poonch

Pakistan on Thursday late night initiated unprovoked ceasefire violation along the Line of Control LoC in Poonch districts Gulpur sector in Jammu and Kashmir. Pakistan resorted to heavy shelling from 11 pm onwards. Indian Army retaliating e...

Goodell: Manning leaves 'indelible imprint' on NFL

NFL commissioner Roger Goodell shared his thoughts on Eli Manning via social media Thursday, one day after the New York Giants announced the quarterback will retire following 16 seasons with the team. Goodell congratulated Manning on his ca...

Brexit bill becomes law after receiving Queen's assent

Britain Prime Minister Boris Johnsons Brexit bill finally became law after receiving royal assent from Queen Elizabeth II on Thursday, just days ahead of the countrys withdrawal from the European Union at the end of this month. Her Majesty ...

Give Feedback