14 Oct 2013
Flash: China's exports likely to remain subdued in coming months - RBS
FXstreet.com (Barcelona) - China's trade balance was negatively affected by a surprising drop in exports, down 0.3% yoy in September vs estimate of 5.5% growth, an occurrence which reflects weak global demand, according to RBS China.
Key Quotes
"Despite the underlying picture is not as bad as the Chinese trade headline suggests, China's exports were weak in September and this follows poor export data in Korea and Taiwan. The subdued export numbers in Asia reflect the still muted state of global demand. Imports did substantially better."
"Moreover, the overall import data masks a contrast between weak processing imports and strong normal imports used in China's own economy. Looking ahead, export data is likely to remain subdued in the coming months."
"Nonetheless, with GDP growth higher than China's government's bottom line, we expect it to hold on to the firmer monetary stance that it has pursued since mid 2013."
"The over-invoicing of exports to disguise capital inflows that took place in 2012H2 and, especially, in 2013H1is not an issue anymore but it inflated the base in September 2012 used to calculate yoy export growth; in our estimate by about 2 ppt."
"Thus, we gauge actual export growth at about 1.7% in US$ terms in September. Also, falling prices affect the headline data. With prices of exports in US$ terms falling by about 2% yoy at the moment, on our estimates actual exports expanded by about 3.8% yoy in real terms in September."
Key Quotes
"Despite the underlying picture is not as bad as the Chinese trade headline suggests, China's exports were weak in September and this follows poor export data in Korea and Taiwan. The subdued export numbers in Asia reflect the still muted state of global demand. Imports did substantially better."
"Moreover, the overall import data masks a contrast between weak processing imports and strong normal imports used in China's own economy. Looking ahead, export data is likely to remain subdued in the coming months."
"Nonetheless, with GDP growth higher than China's government's bottom line, we expect it to hold on to the firmer monetary stance that it has pursued since mid 2013."
"The over-invoicing of exports to disguise capital inflows that took place in 2012H2 and, especially, in 2013H1is not an issue anymore but it inflated the base in September 2012 used to calculate yoy export growth; in our estimate by about 2 ppt."
"Thus, we gauge actual export growth at about 1.7% in US$ terms in September. Also, falling prices affect the headline data. With prices of exports in US$ terms falling by about 2% yoy at the moment, on our estimates actual exports expanded by about 3.8% yoy in real terms in September."