China's foreign trade continues to rebound as demand improves
A supermarket in Anhui province yesterday ahead of the lunar new year holiday. China's exports and imports surged in January as the first data of the year pointed to robust domestic demand and a pick-up in the economy. photograph: reuters
China’s foreign trade continued to rebound strongly in January, data released yesterday showed, a sign that the recovery is stabilising on the back of improvements in both domestic and foreign demand.
Exports surged 25 per cent from a year earlier, much higher than expected, while imports were up 28.8 per cent to give an unexpectedly high trade surplus of $29.2 billion (€21.77 billion).
The figures are distorted by the fact that this year’s lunar new year holiday starts tomorrow, whereas, last year it took place in January. However, analysts believe the data showed the recovery was taking strength.
New lending by China’s banks in January beat expectations at 1.07 trillion yuan (€130 billion) and more than doubled from December.
Total social financing, which is a broad measure of liquidity in the economy, leapt to 2.54 trillion yuan (€300 billion).
“A lower comparative base last year caused by fewer working days has helped push up the growth rate this year,” Li Jian, a foreign trade expert from a research institute at the ministry of commerce, said.
Yesterday’s data showed that China’s trade with the EU appears to be bouncing back having been overtaken by the US last year. Trade with the EU rose 10.5 per cent year-on-year last month to stand at $47.14 billion (€35.1 billion). Trade with the US was 23.4 per cent higher at $43.7 billion (€32.6 billion).
Economists expect inflation to gather steam through the first quarter, although likely staying below 3.5 per cent in 2013, a level they expect the government will soon announce as its target.
After adjustments to seasonal factors, January data remained bullish, with foreign trade up 8.1 per cent year-on-year, exports up 12.4 per cent and imports up 3.4 per cent.
Chen Hufei, a researcher at the Bank of Communications, said the growing domestic market helped imports, while the import of iron ore, coal and steel rose sharply on the back of infrastructure projects. He said external demand had improved as exports to Europe and the US stabilised and emerging markets remained strong.
Industrial production, retail sales and fixed-asset investment numbers for January will be combined with February data and published in March.