China’s strong trade data supports global economy form downfall

The trade surplus expanded from 343.10 billion Yuan in November to 382.05 billion Yuan in December, according to the Customs General Administration of China (CGAC), while analysts expected the surplus to contract to 338.80 billion Yuan. The fresh figures will come as somewhat of a relief to policymakers after China's recent run of bad news which has seen equity prices plunge some 13% since the start of the year. 

Exports rose from -6.8% to -1.4% versus expectations of -8.0%.  It shows that exports are on a rising trend and have been so since the autumn of 2015. Chinese imports are also picking up strongly. It supports inventory depletion having been a strong driving force behind the slowdown. This is positive for the rest of the world not least other emerging markets with high exposure to China such as Brazil. Thus Chinese economy is in a phase of stabilisation and gradual albeit a moderate recovery. This should contribute to easing the selling pressure on the CNY as well.