China’s exports rose for the first time in five months in December and by more than expected, signalling a modest recovery in demand as Beijing and Washington agreed to defuse their prolonged trade war.
The world’s largest economies are set to sign a Phase 1 trade deal today, marking a significant de-escalation but not an end to a dispute that has rattled financial markets and weighed heavily on global business confidence.
China’s December exports rose 7.6% from a year earlier, customs data showed yesterday.
The median forecast from a Reuters poll of analysts had been for a 3.2% rise in shipments, following November’s 1.3% drop.
Imports also surpassed expectations, jumping 16.3% from a year earlier and boosted in part by higher commodity prices.
The Reuters poll had forecast 9.6% growth versus 0.5% in November.
While comparisons with a weak December last year flattered both figures, they also pointed to improving demand, both globally and in China, analysts said.
China posted a trade surplus of $46.79bn in December, compared with the poll’s forecast for a $48bn surplus, up from November’s surplus of $37.93bn.
For all of 2019, its exports proved remarkably resilient to trade tensions, rising 0.5%, while imports fell 2.8%.
China’s trade surplus with the United States for December stood at $23.18bn, according to Reuters calculations based on customs data, down from November’s surplus of $24.60bn. China exports to the United States fell 12.5% in 2019, compared with a rise of 11.3% in 2018.
Imports from the United States fell 20.9%, versus a 0.7% rise in the previous year.
Overall sentiment improved last month after the two sides reached the Phase 1 deal, which is expected to cut tariffs and boost Chinese purchases of US farm, energy and manufactured goods while addressing some disputes over intellectual property. China’s Vice Premier Liu He is in Washington from January 13-15 to sign the interim agreement.
However, analysts say the deal does not spell the end of trade tensions and the risk of further complications and re-escalation remains.
“Our judgment is Phase 1 will not put an end to Trump Trade Wars,” analysts with MUFG Bank wrote in a research note prior to the data.
LEAVE A COMMENT Your email address will not be published. Required fields are marked*
GCC webinar recommends issuing cyber protocol to boost online arbitration
QIB launches new online payment solution for large corporate customers
HSBC’s first ‘cashback credit card’ launched in Qatar
Gulf’s 2021 growth rebound seen to be slower than forecast
China oil demand at risk as millions scrap travel
Tesla, BMW approved for slice of $3.5bn EU battery aid
IMF boosts growth outlook as vaccines outweigh the risks
Asian markets sink on US stimulus concerns
Qatar shares extend losses despite bullish local retail investors