China trade data for March is out, and it’s disappointing on all fronts.
Exports and imports missed badly to the downside. From a year earlier exports dropped by 14.6% in Yuan-denominated terms, well below the 12.0% increase expected, while imports slipped 12.3%, better than the 20.5% decline of February but still below the 11.7% level expected.
With imports missing significantly to the downside the nation’s trade surplus declined to ¥18.16 billion, over three times smaller than the level ¥60.6 billion level of February.
The Aussie dollar got smoked on the news, falling more than half a US cent. A short time ago it was trading at 0.7673.
The data, coupled with soft inflation figures released last week, will only intensify speculation that Chinese economic growth may be slowing faster than many were expecting.
We’ll get a better handle on this on Wednesday when GDP figures, along with industrial production, retail sales and urban fixed-asset investment figures for March, will be released to the market.
Any significant undershoot akin to the trade data released today will only see talk of further stimulus, both from the PBoC and Australia’s RBA.