Another Set of Weak Trade Data With No Fundamental Improvement

Economic Research	08 August 2016
China
Economic Highlights
Another Set of Weak Trade Data With No Fundamental Improvement China’s export and import growth surprised the market on the downside in Jul 2016, indicating both domestic and overseas demand recovery remained sluggish. Overall, we hold a cautious view towards China’s trade conditions in 2H16, given mounting uncertainties for global economic recovery and rising volatility of commodity prices. Only low base effect may somehow cushion the slowdown in trade terms in the coming months. On the currency side, CNY is likely to remain stable against USD in the near term given coming G20 meeting and SDR inclusion, but depreciation pressure remains in the medium term given pressure from potential US rate hike in late 2H16 or early 1H17. Economist:  Zhang Fan| +8621 6288 9611 ext 105
To access our recent reports please click on the links below: 01 Aug: More Targeted Stimulus Expected To Help Weakening Industrial Sector 18 July: Downside Pressure Persists 13 July: Mounting Uncertainties Undermine China’s Trade Conditions 11 July: Severe Flooding Brings Near-Term Upside Risk For CPI 01 July:  Slower Manufacturing PMI As Demand Weakens 27 June: Brexit: Limited Impact On China, But More Challenges On Trade Terms