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China Feb exports jump 44.5 percent, strongest in 3 years, imports up 6.3 percent

Reuters  |  BEIJING 

(Reuters) - China's unexpectedly surged at the fastest pace in three years in February, suggesting its economic growth remains resilient even as trade relations with the rapidly deteriorate.

Trade tensions have jumped to the top of the list of risks facing this year, with proposed U.S. tariffs on and aluminium imports suggesting more measures may be on the way, Zhou Hao, senior emerging markets at Commerzbank, told the Global Markets Forum this week.

China's February rose 44.5 percent from a year earlier, compared with analysts' median forecast for a 13.6 percent increase, and an 11.1 percent gain in January, official data showed on Thursday.

Imports grew 6.3 percent, the said, missing analysts' forecast for 9.7 percent growth, and down from a sharper-than-expected 36.9 percent jump in January.

Analysts caution Chinese data early in the year can be heavily distorted by the timing of the Lunar New Year holiday, which fell in February this year but in January in 2017.

But combined January-February trade data also showed a dramatic acceleration in export growth.

rose 24.4 percent on-year in Jan-Feb, much better than 10.8 percent in December and 4 percent growth in Jan-Feb last year.

The government also releases combined data for the first two months in an attempt to smooth out seasonal distortions.

The deceleration in import growth for February may be payback for the previous month's unusual strength, rather than a sign there has been an abrupt weakening in demand.

Robust import growth in January was mostly led by commodities as factories scrambled to restock inventories ahead of the long holiday.

Imports in the first two months of the year rose 21.7 percent, compared with 4.5 percent in December.

China's trade surplus widened to $33.74 billion for February, compared with forecasts for $0.6 billion and January's $20.35 billion.

For Jan-Feb combined, the surplus rose 43.6 percent from the year earlier period to $54.32 billion.

Boosted by a global trade boom in 2017, China's grew at the fastest pace since 2013 and served as one of the key drivers behind the economy's forecast-beating 6.9 percent expansion last year.

But tough U.S. trade talk last year is now turning into action.

is expected to sign a proclamation on Thursday or Friday to establish the and aluminium tariffs, to counter cheap imports, especially from China, though close U.S. allies may get exemptions.

The measures are expected to go into effect in two months, but economists see little immediate impact on

It has already reduced to the U.S. to a trickle, and while aluminium shipments account for around 10 percent of its total global of the metal, the number is still small compared with China's total exports, according to

"All in all, the direct impact on is minimal," Pang said in a note published on Thursday.

Over time, however, any additional punitive U.S. measures and retaliations by or its other major trading partners would reduce global trade flows, disrupt international supply chains and drag on global growth.

U.S. plans to combat intellectual property theft, which are believed to be moving quickly through the pipeline, could also have a more significant impact on China's exporters, particularly in hi-tech, high-value industries.

Net contributed 9.1 percent of China's GDP growth last year.

Chinese said on Thursday that would make a necessary response in the event of a trade war with the but said such a war would only harm all sides.

Speaking on the sidelines of an annual meeting of China's parliament, Wang said had no intention of displacing the and that the two countries did not have to be rivals but should strive to be partners.

(Reporting by and Elias Glenn)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, March 08 2018. 12:29 IST