September Trade Data Slightly Better Than Expected

China September trade figures were slightly better than expected, although most of the upside surprise rested with exports. We came in at -6.2% y/y for September, versus -8.0% expected and -8.8% prior. Imports were at -6.2% y/y, versus -6.3% expected and -7.3% prior. The trade surplus improved to $77.7bn from a revised $68.2bn in August.

• The marginal export beat was hinted at by the Taiwan and South Korean prints for the same month.
• At -6.2%y/y we are only marginally above recent lows though. By country, most of the improvement reflected stronger exports to Asian economies. We were higher in terms of exports to the US and EU on a m/m basis, but still down on levels of a year ago.
• Officials still described the external backdrop as complex and challenging (per Reuters), but the Q4 situation is expected to improve.
• On the import side, we are also away from recent trough points, but the recovery pace still appears modest at this stage.
• Key commodity import volumes were generally down in the month - for coal, crude oil, natural gas and iron ore, but remain comfortably positive in y/y terms.

Fig 1: China Export & Imports Y/Y - Above Recent Lows

Source: MNI - Market News/Bloomberg