CHINA+ DATA WRAP 7 NOVEMBER 2022: Trade Balance Barely Rises as Exports Slow

China’s Trade Balance Barely Rises as Import Growth Overtakes Export Growth

Duncan WrigleyChina+

8 Nov 2022 China+ Monitor China's Trade Surplus Barely Rises, as Exports Slow

• China’s export data for October indicate weakening global demand, especially in the U.S. and E.U.
• The goods trade surplus widened only slightly, as imports held up relatively well.
• FX reserves rose in October, with more going on than accounted for by the official explanation.

Duncan WrigleyChina+

7 Nov 2022 China+ Monitor China's Current Account Surplus Mushrooms in Q3

• China’s current account surplus exploded to a re- cord $144B in Q3...
• ...driven by an expanded goods trade surplus as exports rebounded faster than imports.
• Net outflows of foreign direct investment indicate a fall in confidence in China’s economic outlook.

Duncan WrigleyChina+

2 Nov 2022 China+ Monitor China's Production Disruptions Weigh on Asian Regional Trade

• The Caixin manufacturing PMI showed a moderating pace of decline.
• Some companies increased input purchases, ahead of new product launches.
• Korean exports fell—notably to China and Japan— indicating regional supply-chain issues.

Duncan WrigleyChina+

CHINA+ DATA WRAP 24 OCTOBER 2022: Official GDP beats expectations on infrastructure support, despite property drag

China's GDP rebound stronger than expected
Industrial output boosted by unblocking of supply chains
Consumption continues to struggle under zero-Covid policy
Property drags down fixed asset investment
Home prices fall more quickly in existing home market
China trade balance remains large despite slowing export growth
Japan flash manufacturing PMI points to a gloomy outlook

Craig BothamChina+

21 Oct 2022 China+ Monitor Japanese Exports' Uptick will Falter over Winter

• Japanese exports have been almost flat in dollar terms, despite headline growth in yen terms.
• Rapid import growth and a large trade deficit contin- ue to put pressure on the yen.
• China’s benchmark lending rate was unchanged, as policymakers focus on the Party Congress.

Duncan WrigleyChina+

27 Sept 2022 China+ Monitor An Unsustainable Rebound for Japanese Growth in September

• Japan learns to live with Covid, but must still contend with slower global growth, and bad weather.
• The renminbi is tumbling, along with every other currency, but capital flight risks compel PBoC action.
• Rumours of a coup in China are based on a rogue Twitter account, and should be discounted.

Craig BothamChina+

22 Sept 2022 China+ Monitor Korean Exports: Better than they Look, but Still Terrible

• Holiday effects exaggerated the weakness of Korean exports in September...
• ...But global demand evidently is cooling; nominal trade data are inflated by energy prices.
• China is now clearly a significant drag on global growth, as stimulus focuses on supply over demand.

Craig BothamChina+

16 Sept 2022 China+ Monitor The External Picture Deteriorates for a Helpless Japan

• Japan’s trade deficit blew out in August, thanks to energy costs and a falling yen.
• Exports are softer than they seem, flattered for now by price and base effects, but slowing at the margin.
• Yen weakness is worrying policymakers, but it can’t be fixed by unilateral intervention.

Craig BothamChina+

8 Sept 2022 China+ Monitor Headwinds are Building for the Renminbi, as Exports Face Reality

• Chinese export growth slowed more than expected
  in August, as reality catches up after reopening.
• Export growth should continue to weaken, and import compression looks mostly played out...
• ...This means that the last support for the renminbi is crumbling, at a pivotal moment.

Craig BothamChina+

CHINA+ DATA WRAP 7 SEPTEMBER 2022: The global slowdown catches up with China

The global slowdown catches up with China

Craig BothamChina+

2 Sept 2022 China+ Monitor A Cold Autumn, and Colder Winter, Looms for Global Exporters

• Korean export growth slowed again in August, and was worse than the headline...
• ...coupled with downbeat regional manufacturing PMIs, the outlook for global trade is bleak.
• Inflationary pressures are at least receding, along with demand, bringing a measure of relief.

Craig BothamChina+

23 Aug 2022 China+ Monitor Global Demand is Fading Fast, and China Won't Ride to the Rescue

Early Korean export data suggest that global trade is still slowing, particularly if energy is excluded.

China’s Omicron lockdown and reopening distorted the data, but the underlying trend is clear, and grim.

Chinese easing efforts still look inadequate, but the central government is finally stepping in.

Craig BothamChina+

18 Aug 2022 China+ Monitor Japan Faces a Growing Trade Deficit, Despite the Weaker Yen

Japan’s trade deficit widened again in July, thanks to a surging import bill.

Energy costs are a big part of the problem, but recent yen weakness is more curse than blessing.

Exports are yet to benefit from the currency’s fall, and key imports are insensitive to price changes.

Craig BothamChina+

CHINA+ DATA WRAP 08 AUGUST 2022: An upside surprise, but Chinese exports are losing momentum at last

Chinese trade continues to surprise to the upside

China's FX reserves recover slightly, but have further to fall

Craig BothamChina+

9 Aug 2022 China+ Monitor Subsidies Shore up Chinese Exports, but Pressure is Building

China reported another record trade surplus in July, thanks to surprisingly strong export growth...

...but exports are starting to slow, at the margin, and still face structural headwinds this year.

Generous government subsidies cannot hold back the tide indefinitely, and risk political blowback.

Craig BothamChina+

8 Aug 2022 China+ Monitor External Headwinds Build for China, and the Renminbi will Suffer

China’s current account balance fell in Q2, despite strong trade balance figures.

The hit from the income account is unlikely to be repeated, but tailwinds are fading.

Export growth must slow, and compression of demand can’t go much further.

Craig BothamChina+

4 Aug 2022 China+ Monitor Supply-Side Stresses are Fading, Bringing Hope of Disinflation

Supply chains are recovering, with delivery times and shipping costs improving in East Asia.

Lower raw material costs are reducing cost-push  inflation, and should feed through to output prices.

The main supply-side risks now are political, as China retaliates for Speaker Pelosi’s Taiwanese trip.

Craig BothamChina+

2 Aug 2022 China+ Monitor Reality Reasserts Itself in China, as the Reopening Rebound Fades

China’s PMIs fell in July, reversing the June bounce, as the gains from reopening were exhausted.

Other sources of demand are few and far between, with stimulus efforts limited in scope and ambition...

...and global demand on the wane amidst multiple headwinds, as clearly shown by Korean export data.

Craig BothamChina+

1 Aug 2022 China+ Monitor No Change from Policymakers in Japan or China on the Horizon

Japan’s Tokyo CPI inflation was marginally stronger than expected, but still driven by cost-push factors.

Yen weakness should relieve pressure on the BoJ, and confirms an outlook of policy stability into 2024.

China’s Politburo has emphasised zero-Covid over growth, with few signals of significant stimulus.

Craig BothamChina+