China Feb trade deficit at $31.5bln as imports leap
Baku, March 10 (AZERTAC). China chalked up its largest trade deficit in at least a decade in February at $31.5 billion, as imports soared 39.6 percent on a year earlier at more than twice the pace of export growth, leaving analysts cautious about seasonal distortions to trade activity.
Exports grew at 18.4 percent, undershooting expectations of 32 percent growth, while imports came in well ahead of forecasts of 27 percent growth to their strongest in 13 months as factories returned to full time work after January`s week-long Lunar New Year shut down that delayed shipments.
Investors had been given some forewarning of the data earlier in the week by Commerce Minister, Chen Deming, who told a news conference on Wednesday that the value of imports and exports in January and February combined had increased by about 7 percent.
Economists at HSBC had warned clients to brace for a deficit as large as $28 billion. The market consensus had been for a deficit of $4.9 billion.
The scale of the deficit may further deflect criticism China faces from countries including the United States which say that Beijing unfairly supports its export industries and keeps its currency artificially weak.
China`s quarterly economic growth is widely forecast by analysts to slow to just over 8 percent in the first quarter from 8.9 percent in the previous quarter, marking the fifth consecutive quarter of slowdown and likely to put the economy on track for its slowest full year of growth in at least a decade.
That slowdown is on course to be a soft landing though, with a clutch of indicators on Friday easing investor fears of a sharp deterioration and revealing ample room for Beijing to loosen policy further to support growth.
Expectations of a policy response from Beijing were entrenched by the first major flurry of hard economic data of the year, which revealed an easing in the pace of industrial output, inflation, fixed asset investment and retail sales.
Loan growth data cemented the view that monetary policy would be relaxed further to support demand for credit and ensure policymakers achieve their desired outcome of an economy slowing sufficiently to stop speculative investment, while creating enough jobs to maintain social stability.
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