China: February trade figures cast doubts on growth - Commerzbank

Hao Zhou, analyst at Commerzbank, notes that China’s trade growth for February came in well below expectations, thereby renewing concerns over the health of the economy and triggered fears of a further slowdown for the foreseeable future.

Key Quotes

“In year-on-year terms, exports (in USD terms) collapsed by 20.7% in February, much worse than market consensus of 5.0% drop. Imports (in USD terms) dipped by 5.2% in February, which is also well below than market expectations of -0.6%.”

“Varying effects of Chinese New Year make year-on-year comparisons for February trade data notoriously volatile. The combined January/February imports, however, still don’t show any rosy picture. In USD terms, they decreased by 3.1%, while they increased by meagre 1.5% in CNY terms.”

“We have to conclude: Chinese import data still illustrate a continuous downtrend for the time being, indicating that Chinese domestic demand is still on a soft footing at this junction despite efforts to boost demand.”