The General Administration of Custom of China has published the January trade figures. Exports contracted by 0.5% from a year earlier, better than the market expectation of a 1.4% fall. However, imports contracted by 15.3% from a year earlier, which was well below the expected 3.6% contraction. On a month-on-month basis, exports fell by 14.2% and imports fell by 22.5% before seasonal adjustment:
As a result of the weakness across the board the trade surplus unexpectedly widened to US$27.28 billion from US$16.52 billion in December, while the market was expecting a contraction to US$10.4 billion:
The Chinese New Year factor is in play for January and helps explain the fall in imports. I hesitate to read too much into it on that basis but such a fall may well suggest weakness in domestic demand and a slowing economy:
