CNY: PBOC fixing stable again as exports recover – MUFG

By FXStreet FXStreet (Delhi) – Derek Halpenny, European Head of GMR at MUFG, suggests that the key data of the week from China – the December trade report – has helped provide some stability for the financial markets with the annual change in exports accelerating from -3.7% to +2.3%.

Key Quotes

“The caveat though is that this is in local currency terms. In dollar terms, exports did also improve but remained negative with the annual rate improving from -6.8% to -1.4%. The consensus though was for export growth to worsen. While we could therefore conclude this as being good news, a Chinese Customs spokesman played down the improvement putting it down in part to “seasonal factors” while adding that 2016 will be another difficult year for trade. So the data is certainly enough to help restore some degree of stability to the financial markets but is unlikely to remove the fears in the markets over the slowdown in China and how that will impact global growth and commodity prices.

One final point worth noting is that while the falling price of commodities helped push imports lower (imports -14.1% in 2015 & exports -2.8%), in volume terms demand from China was quite …read more

Source:: FX Street