China's trade growth accelerated sharply in January-February(exports: +21.8% yoy, imports: +19.8% yoy) and came in well above consensus expectations, prompting Goldman's Rich Privorotsky to ask:
Rebounding aggressively. China exports were strong and CPI came in hot earlier in the week, prompting the question: is China done exporting deflation?
Government data showed that exports soared 22% during the period, compared with a 7.2% median estimate from Wall Street analysts surveyed byBloomberg. Imports jumped nearly 20%, according to a statement released Tuesday by the General Administration of Customs. The trade surplus came in at $214 billion, an all-time high for the January-February period.
Notably, both months are combined to smooth out any distortions caused by the Lunar New Year holiday.
While on the face of it, one could argue that trade flows show China is becoming less reliant on the US market.Exports to the US fell 11%, while shipments to Africa surged nearly 50%. Exports to ASEAN rose more than 29%, and shipments to the EU climbed almost 28%.
This data suggestsBeijing is finding alternative marketsas the Trump administration's 'America First' agenda decouples from China.
However, instead of exporting to the US, China is 'trans-shipping'.Exports from China to Vietnam are soaring inversely to the decline in exports to US...
...and then Vietnam's exports to the US are soaring...
Total exports for January nearly topped $357 billion, the second-highest on record, according to Bloomberg calculations based on official data.
Société Générale SA economist Michelle Lam said surging trade volumes in China were due to strong tech product demand driven by the artificial intelligence boom.
Source: ZeroHedge News
