MNI China Daily Summary: Monday, November 11

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MNI BRIEF: China Oct CPI Slows For 2nd Month To 0.3% Y/Y

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FED: Powell's Time Looks Up, Replacement Could Be Less Willing To Cut Rates?

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US DATA: Large Trade Deficit To Drag On GDP But Sign Of Strong Demand

US DATA
USEM BulletGlobalEmerging Market NewsData BulletBulletMarketsFixed Income BulletsForeign Exchange BulletsRegionNorth America
  • The advance goods trade balance saw a notably larger deficit than expected in September at $108.2bn (cons $96.0bn) after an only marginally revised $94.2bn in Aug.
  • It sees the three-month deficit widen to an estimated 4.2% GDP, its largest since mid-2022.
  • It should see a larger projected drag from net trade on Q3 GDP growth in today’s final Atlanta Fed GDPNow estimate (currently at a strong 3.3% as of Oct 25 and net trade adding 0.04pps) before tomorrow’s advance release.
  • However, the details point to it coming from strong domestic demand.
  • Imports increased 3.8% M/M for the strongest monthly increase since Mar 2022 (all nominal values here for the advance data) whilst exports slipped -2.0% M/M for the sharpest decline since Mar 2024).
  • Within imports, all major categories increased strongly barring the small “other” categories, with notably increases for consumer goods (5.8% M/M) and capital goods (3.1% M/M).
  • It continues what has been a period of particularly strong capital goods imports growth, with volumes as of August rising 17.3% Y/Y, likely receiving a tailwind from increased onshoring. 
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  • The advance goods trade balance saw a notably larger deficit than expected in September at $108.2bn (cons $96.0bn) after an only marginally revised $94.2bn in Aug.
  • It sees the three-month deficit widen to an estimated 4.2% GDP, its largest since mid-2022.
  • It should see a larger projected drag from net trade on Q3 GDP growth in today’s final Atlanta Fed GDPNow estimate (currently at a strong 3.3% as of Oct 25 and net trade adding 0.04pps) before tomorrow’s advance release.
  • However, the details point to it coming from strong domestic demand.
  • Imports increased 3.8% M/M for the strongest monthly increase since Mar 2022 (all nominal values here for the advance data) whilst exports slipped -2.0% M/M for the sharpest decline since Mar 2024).
  • Within imports, all major categories increased strongly barring the small “other” categories, with notably increases for consumer goods (5.8% M/M) and capital goods (3.1% M/M).
  • It continues what has been a period of particularly strong capital goods imports growth, with volumes as of August rising 17.3% Y/Y, likely receiving a tailwind from increased onshoring.