Chinese Exports Surge 14.1% CRUSHING Expectations

Chinese exports surged 14.1 per cent year-over-year (YoY) in December, beating expectations for a 5 per cent rise (via Michael McDonough).

Meanwhile, imports increased six per cent YoY, ahead of expectations of a 3.5 per cent rise.

Trade balance widened to $31.6 billion, more than consensus of $20 billion.

A breakdown by region showed that exports to the U.S. grew 9.6 per cent YoY in December, from -2.6 per cent in November. Exports to the EU rose 1.9 per cent, after contracting 18 per cent in November. Exports to Japan however slumped 6.9 per cent. 

*Bank of America’s Ting Lu, named the third most accurate forecaster on the Chinese economy by Bloomberg, wrote in a note that both imports and exports have “bottomed out from their lows in mid-2012” Weakness in the U.S., Europe and Japan will continue to weigh on growth in these areas.

Hard landing watchers pay particular attention to the import data because it has a domestic demand component and offers insight on domestic demand growth as China attempts to rebalance its economy.

Moreover, China is often criticised for doctoring its data, but its trade data is widely considered to be one of the most reliable economic indicators.

This follows on some disappointing news about loans in December, which came in at 454.3 billion yuan, below estimates of 550 billion yuan.

The Shanghai Composite is now up 0.61 per cent.


At 9 p.m. ET China will release its December trade data.

Analysts polled by Bloomberg are looking for for imports to rise 3.5 per cent year-over-year (YoY), exports to rise 5 per cent YoY, and the trade balance to widen to $20 billion. This data would offer insight into whether China’s economy really is picking up.

Bloomberg BRIEF economist Michael McDonough tweeted this chart ahead of the data that gives us insight into its largest trading partners:

China trade chart

Photo: Michael McDonough via Twitter


*Note: Piece was updated at 11:15 p.m. to include comments from Ting Lu and a breakdown of export by region.

SEE ALSO: SocGen Offers A Surprising Forecast For Gold Under A Chinese Hard Landing Scenario >

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