Data released by the General Administration of Customs showed that the trade surplus shrank to $58.55 billion in March from $125.16 billion in February. Economists had expected a decline to $70.2 billion. Exports from China fell by 7.5% per annum (the sharpest decline since August 2023), offsetting the February increase (+7.1% per annum). Consensus estimates suggested a reduction of 3% per annum. Meanwhile, against the background of sluggish domestic demand, the volume of imports decreased by 1.9% per annum in March after an increase of 3.5% per annum in February. Economists had forecast growth of 1.2% per annum. Overall, the latest data highlighted the difficult task facing policymakers who are trying to support a shaky economic recovery. At the same time, analysts do not expect a full-scale economic recovery in the near future, mainly due to the protracted crisis in the real estate sector.
Yesterday, the Fitch rating agency downgraded the outlook on China's sovereign credit rating to negative, citing risks to public finances as the economy faces growing uncertainty in the transition to new growth models.
Official data on GDP, retail sales and industrial production will be presented next week, which will provide a clearer picture of China's prospects.