Weaker Trade Update, Although Commodity Import Volumes Rebound

(MIN Australia) China trade figures were softer across the board. In USD terms, export growth was -8.7% y/y, against a -3.9% estimate, while imports fell -10.6%, -7.1% was the forecast. The trade surplus slipped to $69.84bn, against a $78.05bn forecast.

• The slowdown in exports is in line with trends elsewhere in North East Asia, see the chart below. Taiwan's export data for November is due later today and the market looks for a reversal of the improvement last month.
• China export growth is now back to early 2020 lows. Exports to most countries/region continued to moderate in y/y terms. The US is now at -25.4%, the EU -10.6%, while to ASEAN we slowed to 5.2%, from 20.3% in October.
• On the import side, volumes rebounded in November, despite the softer headline result. Coal and iron ore import volumes were up strongly, although this largely reverses weakness seen in October. Oil rose further, as did natural gas. Major commodity import volumes are still down in YTD y/y terms though, except for copper.
• The trade surplus is only back to levels from the first half of the year, although there will be speculation the external balance deteriorates as we progress through 2023 on hopes of a China domestic demand recovery as moving away from CZS takes full effect.

Fig 1: China Export Growth Continues To Slow

Source: MNI - Market News/Bloomberg