ICYMI - China trade balance data released over the weekend showed a decline in exports again

Trade balance data is here from Sunday:

• China trade balance data for August - surplus comes in below median estimate

Exports to the US fell 16% y/y in the month after a 6.5% fall in July. Imports from the US were down more than 20% y/y in August.

The fall in exports (see the link for the numbers) comes despite the drop in the yuan. The weakening yuan is thought to be a move by China to try to offset some of the trade war impacts. Which raises the question of perhaps weak global demand is more of a factor. Trade restricitions can tend to have that effect.

I noted on the data post over the weekend that the figures were not a positive for China-related risk. Optimism had been boosted last week due to the planned resumption of US-China trade talks. Let's see how that goes. And, of course, the offset to the bad news is slowness in China's economy will be met with stimulus from authorities. We have already seen a RRR cut (on Friday):

• BOC announces RRR cut of 0.50% w.e.f. 16 September

and other stimulus. There'll be more to come.