Surge in China’s exports and imports boosts recovery hopes
Exports grew 25% from a year earlier versus a forecast of 17% in a Reuters poll. Imports surged 28.8% to comfortably beat a consensus call of 23.3% and the resulting $29.2 billion trade surplus topped a market expectation of $22 billion.
“I think the Chinese New Year effect only explains part of the story," Zhang Zhiwei, chief China economist at Nomura in Hong Kong, told Reuters. “After controlling for the Chinese New Year, the numbers are still very strong and show the economic recovery is on track.”
Other data showed that headline inflationary pressure was subdued. Consumer prices rose 2% in January from a year earlier, bang in line with expectations and down from a seven-month high of 2.5% in December.
Investors bought the argument that an economic recovery that kicked off in the last few months of 2012 was intact. Stock prices in Australia and South Korea rose, despite pressure to take profits around the region ahead of next week’s Lunar New Year lull, while oil and copper futures also gained ground.
Global markets have risen in anticipation of a surge in China’s export growth as a signal of recovering demand in the giant economies of the US and EU.
China’s year-on-year exports growth to the US of 14.5% was the strongest in 10 months, while
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