Foreign trade figures and price trends indicate no unusual weakness in the Chinese economy

BOFIT Viikkokatsaus / BOFIT Weekly Review 2016/02

The value of China’s December exports in dollar terms was up 1 % from a year earlier. Imports contracted 8 % y-o-y on the fall in global commodity prices. As a result, the trade surplus continued to rise. For 2015 overall, the goods trade surplus rose to $595 billion. China’s huge foreign trade surplus balance depreciation pressure on the yuan.

The December price trend was unremarkable: consumer price inflation held at 1.6 % y-o-y, while producer prices continued to decline nearly 6 % y-o-y. Although producer price inflation suggests persisting excess capacity problems and deflationary pressure, there was nothing immediately new or disconcerting in the latest data, making it hard to interpret or explain recent market uncertainty.

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