FX.co ★ Chinese exports fall more-than-expected

Due to the weak global demand, Chinese exports declined at a faster-than-expected pace.

In US dollar-denominated terms, the value of exports fell by 6.1% in December 2016 on a yearly basis after rising by 0.1% in November. Imports rose by 3.1% year-on-year in December after rising by 6.7% in November. The trade surplus of China narrowed to $40.82 billion in the reporting period from $44.61 billion in November.

Economists had expected exports to decline by 3.5% and had projected a 2.4% increase in imports with a trade surplus at $46.5 billion.

For the year of 2016, Chinese shipments declined by 7.7% from 2015, while imports fell by 5.5%.

According to China Minsheng Banking Corp., foreign demand remains weak amid a slowdown in global trade. In this regard, the forecast for exports in 2017 is not so encouraging.

Last year the yuan fell by 6.5% against the US dollar and declined by 6% from the basket of major currencies, thus softening the impact of the weakening global demand. However, it cannot boost sales.

Chinese exports to the United States rose by 5.1%, while shipments to the EU dropped by 4.7%. Exports to South Korea advanced by 8.3%, rising for the first time since March.