Forex Flash: External demand keeps Chinese economy churning – NAB

As is usually the case for this time of year, the seasonal impacts from the Lunar New Year (LNY) holiday are reaping havoc with China’s economic data. In addition to the obvious seasonal impacts, statistical authorities also refrain from releasing some of the more closely watched statistics on economic activity for January.

The data that have been released paint a fairly mixed picture of the economy, but are worth mentioning nonetheless. Trade data for January saw a spike in both imports and exports, with exports growth accelerating to +25% YoY (up from +14% for December). While this was above market expectations, official estimates stripping out the LNY effect actually show growth decelerating to +12.4% YoY (down from +19.2% in December).

“Despite this easing in the growth rate it is still up on the sluggish pace seen for most of last year, continuing on from the surprising improvement in external demand recorded in December.” notes the NAB Analyst Team.