China exports plunge fastest since 2009 on weak global demand
naky
www.diecastingpartsupplier.com
2016-03-10 18:02:16
China’s foreign trade contracted much faster than expected last month, the latest sign of weakening global trade and lethargic domestic commodity demand as the country’s economy slows.
Exports fell 25.4 per cent in February from a year earlier in dollar terms, the worst one-month decline since early 2009 and down from the 11.2 per cent drop in January. Imports fell 13.8 per cent, trimming losses after an 18.8 per cent fall in January.
The February data partly reflect seasonal distortions related to the lunar new year holiday, which occurred earlier this year than last, raising the base of comparison for February 2015. But combined January and February trade data still show a marked deterioration compared with late 2015, analysts say.
In an ominous sign for the renminbi, China’s trade surplus narrowed to $32.6bn in February from an all-time high of $63.3bn in January. The merchandise trade surplus — due mainly to falling prices for commodity imports — has been one of the few bright spots in China’s overall balance of payments over the past year, helping to offset unprecedented outflows from investment and the services trade.
There were also signs that inflated import invoices are being used as a cover to convert renminbi to foreign currency and send funds out of China, mainly to Hong Kong. Foreign exchange reserves data released on Monday indicate capital outflow pressure eased in February as the renminbi stabilised, but many companies and investors remain pessimistic about the Chinese currency.
Imports from Hong Kong surged by 88.7 per cent in February, even as those from other Asian trading partners such as Taiwan, Singapore and South Korea fell.