China: Exports and imports contracted in December – ING

Iris Pang, economist at ING, notes that China’s trade data painted dismal picture of the economy as exports and imports shrank 4.4%YoY and 7.6%YoY in December 2018, respectively, considerably down from ING’s already downbeat forecasts of +2.5%YoY and 0.0%YoY, respectively.

Key Quotes

“Exports fell for commodity energy goods like coal and crude oil. But there were also declines in some electronic related parts and goods and auto-related parts.”

“It was a similar story for imports, but with even greater reductions in electronic-related parts and goods.”

“For the full year, exports and imports rose by 9.9% and 15.8% in 2018 respectively, which resulted in an annual trade surplus of $351.8 billion. This was down from $509.7 billion in 2017, due to faster growth of imports relative to exports. The 31% decline in the trade balance also implies that China's consumption growth was reasonably solid in 2018.”