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.
“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.”