China trade balance data for September 2023
Trade Balance in USD terms 77.7bn
- expected 70.0bn, prior 68.4bn
- in yuan terms a surplus of 558.7bn
Imports -6.2% y/y
- expected -6.0%, prior -7.3%
- in yuan terms -0.8% y/y
Exports -6.2%
- expected -7.6%, prior -8.8%
- in yuan terms -0.6% y/y
China's total goods imports and exports in September registered month-on-month growth for a second consecutive month.
While the yuan is gaining against most of its peers, its weak against the surging USD. The People's Bank of China is trying to contain its losses against the USD, which is weighing on the export sector to an extent (further gradual depreciation would help exporters cope with tepid global demand).
By holding USD/yuan as steady as it can the PBOC is trying to bolster confidence in the currency even as stimulus efforts only produce a stumbling economic bounce.
In other developments, China's stock regulator enhanced measures to prevent capital outflows by domestic investors earlier this week. Capital outflows have also been a factor in yuan weakness. China is also trying to attract foreign investment and a plummeting currency would not do this effort any favours. The stark US-China yield differential is bad enough.
