China: Strong exports and imports data - TDS

Analysts at TD Securities note that China’s both exports and imports in Oct were much stronger than consensus at 15.6% y/y and 21.4% y/y respectively (mkt 11.7% and 14.5% respectively).

Key Quotes

“Part of the reason is due to extra working days in Korea relatively to last year, while likely front loading ahead of US tariffs also plays a part. The trade balance came in slightly less than expected at $34.01bn versus consensus at $35.15bn.”

“ON a 12m basis, the China trade surplus with the US hit another record at $314.8bn and that with Europe increased to $136.2bn, but it declined further with Japan and the rest of the Asia.”

“No major implications for markets from this data but it does suggest that 1) US pressure on China trade will continue even with a divided Congress and 2) the outlook for China trade going forward will likely deteriorate quickly as forward looking data suggest.”